Every contracting officer negotiating a sizable award eventually runs into the same trigger question: does this deal cross the certified cost or pricing data threshold? Under FAR 15.403-4, that threshold is $2.5 million for prime contracts, subcontracts, and modifications awarded on or after July 1, 2018, the line that determines whether an offeror must certify that the cost or pricing data it submitted is accurate, complete, and current as of the date the parties agreed on price.
Background
The certified cost or pricing data requirement traces back to the Truth in Negotiations Act, now codified in the FAR as the requirement at 15.403-4(a)(1): when a contracting officer determines the dollar threshold is exceeded on a negotiated contract, subcontract, or modification, the contractor must submit and certify data showing the government negotiated from complete, accurate, current information rather than an information gap that favors the seller. The threshold itself is not fixed forever. FAR 15.403-4(a)(1) already carries two figures side by side: $950,000 for prime contracts awarded before July 1, 2018, and $2.5 million for prime contracts awarded on or after that date. The reason two numbers sit in the same regulation is that the FAR Council is required to review acquisition-related thresholds for inflation on a five-year cycle, and each review can move the number again without contractors necessarily noticing unless they check the award date on the specific contract in front of them.
That five-year cycle produced its latest change this year. A final rule under FAC 2025-06, FAR Case 2024-001, published in the Federal Register on Aug. 27, 2025 and effective Oct. 1, 2025, raised the underlying inflation-indexed baseline from $2 million to $2.5 million pursuant to the mandatory review required by 41 U.S.C. 1908. The $2.5 million figure now appearing in FAR 15.403-4 is the product of that review, not a one-time policy choice.
Key Details
The mechanics that matter for a proposal team come down to three rules working together. First, the threshold: $2.5 million applies to prime contracts awarded on or after July 1, 2018, while $950,000 governs prime contracts awarded before that date. Second, FAR 1.109(d) locks in whichever threshold applied when the contracting officer determines the requirement applies, and once a threshold has been adjusted for inflation under FAR 1.109(a), that adjusted figure "applies throughout the remaining term of the contract," per FAR 15.403-4. In practice, that means the threshold governing a modification is tied to the contract's original award date, not the date of the modification itself. A contract awarded in 2019 does not suddenly pick up a different threshold because a modification is negotiated in 2026.
Third, the requirement is not absolute even above the dollar line. FAR 15.403-1(b) lists exceptions where certified data is not required regardless of dollar value, including when there is adequate price competition, when prices are set by law or regulation, and when the item being acquired qualifies as a commercial product or commercial service. Conversely, the head of the contracting activity can go the other direction and require certified data below the threshold, but only with written findings explaining why the data is necessary and no exception applies.
The Aug. 27, 2025 rule did not move the TINA threshold in isolation. The same rule adjusted a cluster of related dollar figures that contracting teams track together: the simplified acquisition threshold rose from $250,000 to $350,000, the micro-purchase threshold rose from $10,000 to $15,000, the subcontracting-plan trigger rose from $750,000 to $900,000 for general contracts and from $1.5 million to $2 million for construction, the commercial-item procedures ceiling rose from $7.5 million to $9 million, and the sole-source 8(a) ceiling rose from $25 million to $30 million. Because these thresholds move together on the same five-year clock, a contractor tracking one should check all of them at the same time.
What It Means for Contractors
The first practical step on any negotiated deal near the line is to confirm the award date of the underlying contract before assuming which threshold applies. A pending modification on a contract that was originally awarded before July 1, 2018 is still governed by the $950,000 figure under FAR 1.109(d), even though a brand-new award negotiated today would use $2.5 million. Pulling the wrong threshold either exposes a company to a certification burden it can legitimately avoid, or worse, leads a proposal team to skip a certification the contracting officer is entitled to demand.
Second, before assuming certified data is required simply because a deal exceeds $2.5 million, check whether one of the FAR 15.403-1(b) exceptions applies. Adequate price competition and commercial-item status are the two exceptions contracting teams miss most often, and both can eliminate a data-certification burden that otherwise adds real cost to proposal preparation and increases exposure if the certified data later proves defective.
Third, treat the certification as a liability event, not paperwork. A certification under FAR 15.403-4 is a representation that the data was accurate, complete, and current as of the date of price agreement. If it later proves otherwise, the government has grounds to pursue a defective pricing claim and adjust the contract price downward. Proposal teams working near the $2.5 million line should build in time to verify that supporting cost data, not just the cover certification, is current through the actual date of agreement rather than an earlier snapshot pulled during proposal drafting. Because the certification date is tied to price agreement rather than proposal submission, cost estimators should plan for a final data refresh immediately before signature, especially on deals negotiated over several weeks where labor rates, material quotes, or subcontractor pricing can shift after the initial proposal was assembled.
Finally, because the SAT, micro-purchase, subcontracting-plan, commercial-item, and 8(a) sole-source thresholds all moved on the same Oct. 1, 2025 effective date, contractors should treat this as a single compliance calendar update rather than five separate checks. A company managing subcontracting plans, for instance, needs to know that the $900,000 general trigger and $2 million construction trigger now govern new subcontracts, using the same inflation-review logic that raised the TINA line to $2.5 million.
