Federal Acquisition Regulation (FAR) GovCon Threshold Increases Effective October 1, 2025
The FAR Council updates effective October 1, 2025, in accordance with 41 U.S.C. §1908 and FAR 1.109 result in some acquisition-related impacts for Government Contractors effective October 1, 2025.
We’ll break them down for you here:
Micro-Purchase Threshold (MPT) increased to $15,000 (from $10,000). This means that purchases at or below $15,000 can be made without soliciting competitive quotes and bids do not need substantiation of competition.
Simplified Acquisition Threshold (SAT): increased to $350,000 (from $250,000). This means less administration and paperwork, faster award timelines and fewer regulatory hurdles for contracts meeting the threshold, opening the door for small businesses to compete more easily for federal contracts that were previously more complex and time-consuming. This also increases the number of contracts generally reserved for small business set-asides.
Simplified Acquisition Threshold (SAT) (FAR 13.5) Commercial ceiling increased to $9.5M (from $7.5M). This means that small businesses can now compete for commercial product/service contracts up to $9M (with up to $15M for emergencies & contingency) using simplified procedures. This gives small businesses a chance to win higher value contracts under simplified rules. Note: The Rule of Two often applies by lifting the SAT, but the underlying requirement to set aside for small businesses (when there’s a reasonable expectation of two or more competitive small offers) remains
8(a) Sole-Source Justification threshold increased to $30M (from $25M). This means that Contracting officers can now award sole source 8(a) contracts without public justification for contracts up to $30M
Certified Cost or Pricing Data (formerly TINA) increased to $2.5M (from $2M). This means that the number of certified cost or pricing data certifications is reduced. Less frequent certification reduces the administrative burden for both sides on these mid-sized awards.
Small business subcontracting plan threshold increased to $900k (from $750K) and $2M (from $1.5M for construction). This means that fewer contracts will require formal subcontracting plans, reducing the administrative burden for primes and subcontractors on lower-dollar awards.
Justification & Approval levels and single-award IDIQ thresholds increased. The FAR Council raised several J&A approval cutoffs in FAR 6.304 and increased certain IDIQ thresholds (e.g., moving $100M → $150M in spots), promoting efficiency while preserving approvals on large awards.
Do you have questions about how these may impact your bid strategy? govIRG can help! Give us a call today.