The Simplified Acquisition Threshold, Explained

Almost every conversation about breaking into federal contracting starts in the wrong place. People ask about GSA schedules, about GWACs, about how to find a prime to sub under. Those are real paths, and they are slow. The fast path runs through two dollar figures written into the Federal Acquisition Regulation, and most people who want federal revenue have never learned what those figures actually do.

The first is the micro-purchase threshold. Below it, a federal employee with a government charge card can buy from you this afternoon without competing the purchase at all. The second is the simplified acquisition threshold, usually shortened to SAT. Below that line, the government uses a stripped-down process with fewer clauses, faster award, and a set-aside rule that reserves most of that spending for small businesses.

This article walks through both lanes: the current numbers, the regulation behind them, what competition each requires, how quotes get solicited, and what changes the moment a requirement crosses the line. If you sell software, data work, or engineering services, this is the part of the FAR worth knowing cold.

The two numbers that shape everything

Federal buying is tiered by dollar value. The higher the value, the more process the government owes the public: more publicity, more competition, more documentation, more clauses. Congress sets the boundary values by statute, and the FAR Council writes them into FAR 2.101 as defined terms so hundreds of other FAR sections can refer to them without repeating a number.

Three tiers cover the small end:

• At or below the micro-purchase threshold. No competitive quotations required. Typically paid by government purchase card. Minimal paperwork.
• Above the micro-purchase threshold, at or below the simplified acquisition threshold. Simplified acquisition procedures under FAR Part 13. Competition required, but informal. Reserved for small business in most cases.
• Above the simplified acquisition threshold. Full FAR process, with a narrow exception for commercial products and services that keeps simplified procedures available well past the line.

Current figures, with the cite

The numbers below took effect October 1, 2025, under FAR Case 2024-001, published as a final rule in the Federal Register on August 27, 2025 and issued in Federal Acquisition Circular 2025-06. They are the values now carried in FAR 2.101.

Threshold	Before Oct 1, 2025	Current
Micro-purchase threshold (general)	$10,000	$15,000
Micro-purchase, construction under the Wage Rate Requirements statute	$2,000	$2,000
Micro-purchase, services under the Service Contract Labor Standards statute	$2,500	$2,500
Micro-purchase, contingency operations (inside / outside U.S.)	$20,000 / $35,000	$25,000 / $40,000
Simplified acquisition threshold (general)	$250,000	$350,000
SAT, contingency operations (inside / outside U.S.)	$800,000 / $1.5M	$1M / $2M
Simplified procedures for commercial products and services (FAR 13.500)	$7.5M	$9M
Subcontracting plan floor (FAR 19.702)	$750,000	$900,000

Selected thresholds from FAR Case 2024-001, effective October 1, 2025.

Two details in that table are easy to miss and expensive to get wrong. Construction subject to the Wage Rate Requirements statute has a micro-purchase threshold of $2,000, and services subject to the Service Contract Labor Standards statute have one of $2,500. A $9,000 janitorial services buy is not a micro-purchase. A $9,000 software license is.

Why the numbers move

Under 41 U.S.C. 1908, the FAR Council must review statutory acquisition-related dollar thresholds every five years and adjust them for inflation using the Consumer Price Index for all urban consumers. The adjustments are rounded, which is why you see clean figures like $15,000 and $350,000 rather than the raw arithmetic result. The October 2025 change was that five-year review. On the current cycle, the next scheduled adjustment lands October 1, 2030.

Practical consequence: any guide, training deck, or internal policy quoting $10,000 and $250,000 describes the world before October 2025. Check the date on anything you read, including this page. The controlling number is the one in FAR 2.101 on the day the contracting officer makes the determination.

Lane one: the micro-purchase

A micro-purchase is an acquisition of supplies or services using simplified procedures where the aggregate amount does not exceed the micro-purchase threshold. The defining feature is the absence of a competition requirement. FAR 13.203 allows a micro-purchase to be awarded without soliciting competitive quotations if the purchaser considers the price to be reasonable.

That sentence is why the micro-purchase lane matters to a small vendor. A program office that wants your tool for one team, for one year, at $12,000 does not have to post anything, run an evaluation, or justify picking you. It has to conclude the price is reasonable and document that conclusion, which for a published commercial price is often a copy of the price list.

The counterweight is FAR 13.203's expectation that micro-purchases be distributed equitably among qualified suppliers. A purchaser is not supposed to route every card buy to the same vendor out of habit.

One more useful rule sits in FAR 4.1102. Registration in the System for Award Management is normally required at the time a quote is submitted, but micro-purchases made with a government purchase card as both the purchasing and payment mechanism are exempt. A first-time seller can complete a small card sale while the SAM registration is still processing. That is not a reason to skip SAM. It means one small sale need not wait on it.

The purchase card, from the seller's side

The government purchase card, administered through the GSA SmartPay program, is a commercial charge card carried by federal employees across every agency. Cardholders are delegated a single-purchase limit and a monthly limit. The single-purchase limit is commonly set at the micro-purchase threshold, though agencies set their own delegations and many cardholders are held lower. GSA issued guidance to agency program coordinators when the threshold moved to $15,000.

What this means operationally: your product has to be buyable by a person holding a card. That is a merchant-processing question, not a contracting question. If you cannot accept a card payment, issue a receipt whose name matches your SAM registration, and produce a quote with a fixed total price, you are hard to buy from. Vendors lose micro-purchases to logistics more often than to price.

Lane two: simplified acquisition procedures

Between the micro-purchase threshold and the SAT, the government uses FAR Part 13. The policy at FAR 13.003(a) directs agencies to use these procedures to the maximum extent practicable for purchases that do not exceed the threshold, which is a stronger instruction than it sounds. Contracting officers are not choosing to be informal as a favor. They are following policy.

Competition is required, but the standard is different from the one in FAR Part 15. FAR 13.104 requires the contracting officer to promote competition to the maximum extent practicable and to obtain the supplies or services from the source whose offer is most advantageous to the government. The same section prohibits soliciting based on personal preference and prohibits restricting a solicitation to well-known and widely distributed brands. There is no fixed number of quotes written into the rule for every situation, and there is no requirement for a formal source selection plan, an evaluation board, or written discussions.

Soliciting a single source is permitted, but it must be justified. FAR 13.106-1(b) allows it where the contracting officer determines that only one source is reasonably available, and names the usual reasons: urgency, exclusive licensing agreements, brand-name requirements, industrial mobilization. The determination goes in the file.

Quotes can be requested orally, by email, or through a request for quotations posted publicly. The publicity rule is separate from the competition rule and it is worth knowing precisely. FAR 5.101 requires a contracting officer to synopsize proposed contract actions expected to exceed $25,000 on the governmentwide point of entry, which is SAM.gov. Proposed actions between $20,000 and $25,000 must be displayed publicly, including by appropriate electronic means, for at least ten days or until quotations are opened.

Read that against the thresholds and a gap appears. A $19,000 buy has no SAM.gov posting requirement, so a vendor watching a search feed will never see it. That spending goes to firms the contracting shop already knows, which argues for market-research visibility over portal monitoring.

Before award, FAR 13.106-3(a) requires the contracting officer to determine that the proposed price is fair and reasonable. When only one quote comes back, the file has to explain the basis for that conclusion, drawing on market research, prices paid on previous purchases, published price lists, or another reasonable basis. Give the contracting officer that material voluntarily. A quote that includes a public price list, a comparable commercial sale, or a clear basis of estimate makes the determination easy, and easy determinations get awarded.

Notification of unsuccessful quoters is lighter here too. Under FAR 13.106-3, for acquisitions at or below the SAT, notification to unsuccessful suppliers is given only if requested or otherwise required. If you lose a simplified acquisition and want to know why, ask. Nobody is obligated to volunteer it.

What a quote legally is

This trips up nearly every new seller, and FAR 13.004 is explicit about it. A quotation is not an offer and cannot be accepted by the government to form a binding contract. When the government responds to your quote by issuing a purchase order, the government is making the offer. The contract is formed when you accept, which you may do by signing the order or, in most cases, by beginning performance.

Two consequences follow. A quote is informational, so the government can issue an order on terms different from the ones you quoted, and you are not bound until you accept. Read the order before you ship. And if an order arrives with a delivery date you cannot meet, say so before performing rather than after.

The small business reserve

This is the single most valuable rule in the small-dollar range. FAR 13.003(b)(1) provides that acquisitions with an anticipated dollar value above the micro-purchase threshold but at or below the simplified acquisition threshold are set aside for small business concerns. The set-aside applies where the contracting officer has a reasonable expectation of obtaining offers from at least two responsible small businesses that are competitive on price, quality, and delivery, the test commonly called the rule of two.

The effect is that the $15,000 to $350,000 band is, in ordinary circumstances, a small-business-only market. That is not a preference program bolted onto an open market. It is the default rule for that band, and when the threshold rose from $250,000 to $350,000, the band of spending covered by it grew.

Being a small business for this purpose means meeting the SBA size standard for the NAICS code the contracting officer assigns to the requirement, and having that representation current in SAM. For software and technology work, the codes you will see most often are 541511 for custom computer programming, 541512 for computer systems design, 541519 for other computer related services, and 518210 for hosting and data processing.

What falls away below the threshold

The simplified acquisition threshold is a switch for a long list of requirements elsewhere in the FAR. At or below it:

• Certified cost or pricing data are not required. FAR 15.403-1 prohibits obtaining them for acquisitions at or below the SAT. No cost buildup, no certificate of current cost or pricing data.
• Cost Accounting Standards do not attach. Small-dollar work does not drag a CAS-compliant accounting system behind it.
• No subcontracting plan. The floor for a small business subcontracting plan under FAR 19.702 is $900,000, well above the SAT.
• A shorter clause set. Simplified acquisitions use a condensed set of terms rather than the full clause matrix of a negotiated procurement.
• No formal source selection. No written evaluation plan, no competitive range, no discussions, no debriefing obligation under FAR Part 15.

That combination is why a two-person firm can respond to a simplified acquisition without a proposal team.

What applies at every dollar

Some obligations have no dollar floor, and new sellers get surprised by them.

Section 889 of the FY2019 NDAA, implemented at FAR 52.204-24 and 52.204-25, bars the government from procuring covered telecommunications and video surveillance equipment or services, and it reaches acquisitions at or below the micro-purchase threshold as well as commercially available off-the-shelf items. There is no small-purchase escape hatch. You represent on it in SAM and you own the answer.

A unique entity identifier and an active SAM registration are required beyond the narrow exceptions in FAR 4.1102. And the anti-splitting rule at FAR 13.003(c)(2) forbids breaking a requirement that aggregates to more than the applicable threshold into several smaller purchases merely to permit simplified procedures. If a program office proposes buying your $60,000 platform as five $12,000 card transactions, the answer is no.

Just above the line

Crossing $350,000 does not immediately mean a full negotiated procurement. FAR 13.500 authorizes simplified procedures for acquisitions above the SAT that do not exceed $9 million, and up to $15 million for the categories described in that section, where the contracting officer reasonably expects offers to include only commercial products or commercial services. That authority carries its own publicity and competition requirements, and it is more structured than a sub-SAT buy, but it is still Part 13 rather than Part 15.

One nearby figure moved in the same inflation adjustment: the approval threshold for other than full and open competition at FAR 6.304 went from $750,000 to $900,000, which changes how high a sole-source justification has to climb for signature.

Why this is the accessible entry point

Put the pieces together from a small technology vendor's point of view. Below $15,000 there is no competition requirement and, with a purchase card, not even a SAM registration requirement. Between $15,000 and $350,000 the market is reserved for small business, the process is informal, no cost or pricing data is required, and award can happen quickly. Below $25,000 the buy never has to be publicly posted, which means relationships and market research visibility beat portal monitoring.

That is a genuinely open door, and most new entrants walk past it while chasing a schedule contract they are not yet ready to hold. A first federal sale at $40,000 is worth more than it looks: it creates a contract you can cite, an agency reference, and a performance record that makes the next competition winnable. This is the market Precision Federal works in, and the pattern holds — the vendors who get traction start small, deliver cleanly, and let the record compound.

The regulation is also moving underneath all of this. Executive Order 14275, signed April 15, 2025, launched the Revolutionary FAR Overhaul, a rewrite of the FAR into shorter, plain-language parts, carried out first through agency class deviations and then converted into rulemaking part by part. Part 13 is renamed "Simplified Procedures for Non-commercial Acquisitions" in the model deviation text. The statutory dollar figures do not change because of a renumbering, but a citation you memorize today may point somewhere else next year. Cite the number and the concept, verify the current section, and read the clause list in the actual solicitation rather than trusting a remembered paragraph.

A working checklist

1. Register in SAM and get your unique entity identifier. Complete every representation, including the Section 889 representation, and keep the registration active.
2. Pick your NAICS codes deliberately and confirm you are under the SBA size standard for each one. The set-aside protection in the $15,000 to $350,000 band runs through that code.
3. Be able to take a card. Merchant processing, a clean quote on letterhead, a fixed total price, and a receipt that matches your legal entity name.
4. Publish a price list. It makes the contracting officer's fair-and-reasonable determination under FAR 13.106-3 nearly automatic.
5. Know which threshold applies to your work. $15,000 for supplies and most technology services, $2,500 for services covered by the Service Contract Labor Standards statute, $2,000 for covered construction.
6. Do market research outreach, not just portal watching. Buys under $25,000 are never required to be posted on SAM.gov.
7. Respond to sources sought notices. They are how a contracting officer builds the reasonable expectation of two small business quotes that triggers the set-aside.
8. Refuse a split requirement. If someone proposes slicing a buy to stay under a threshold, FAR 13.003(c)(2) forbids it.
9. Read the purchase order before you perform. Your quote was not the offer; the order is, and performance is acceptance.
10. Ask why you lost. Under the SAT, notification to unsuccessful quoters is given only on request.

Where to go from here

Three numbers are the map. $15,000 is where competition stops being required. $350,000 is where the small business reserve ends and the heavier machinery of federal contracting begins. $25,000 is where opportunities become visible in public. Learn those three and the handful of FAR sections that hang off them, and the small end of federal buying stops looking like a maze.

If you do one thing after reading this, verify that your SAM registration is active and your size representation is current for the NAICS codes you sell under. Everything above depends on that record being right on the day a contracting officer looks you up.

This article is general education, not legal advice. Thresholds change and specific solicitations control. Confirm the current figure at FAR 2.101 before relying on it.