July 29, 2010
Section 413(a) of the Dodd-Frank Act states that the net worth test for determining whether a natural person is an accredited investor "shall be $1,000,000 excluding the value of the primary residence of such natural person." The Commission should clarify whether and under what circumstances debt secured by the primary residence should be likewise excluded from the computation of $1,000,000 in net worth. It would seem incongruous that the value of the residence, but not the balance of the associated mortgage, should be excluded from the calculation.