FINRA Raises Gifts Rule Limit to $300, But Lower Limits Still Apply Under Other Rules

On February 12, 2026, the US Securities and Exchange Commission approved FINRA’s proposed amendment to FINRA Rule 3220 (the Gifts Rule), increasing the annual gift limit from $100 to $300 per recipient. The amendment will become effective as of March 30. Firms adjusting limits should carefully review implications of any changes.

APPLICABILITY

The Gifts Rule applies to gifts in relation to the business of the recipient’s employer (e.g., when the gift is tied to an existing or potential business relationship involving brokerage or investment activity).

The Gifts Rule does not apply to gifts from a FINRA member firm or its associated persons to individuals who are not employees of an institutional customer, including a member’s own associated persons or retail customers.

SUMMARY OF AMENDMENTS

In addition to raising the limit, [1] the amendment [2] clarifies several aspects of the rule:

• Valuation:
  • Gifts must generally be valued at cost, exclusive of tax and delivery charges.
  • Tickets for sporting or other events must be valued at the higher of cost or face value.
• Aggregation: All gifts given by the member and its associated persons to a particular recipient should be aggregated for purposes of the $300 limit.
• Excluded Gifts: The following gifts do not count toward the limit:
  • Gifts for infrequent life events (e.g., birth of a child) that are not related to the employer’s business, provided that the member does not directly or indirectly bear the cost.
  • Customary and reasonable bereavement gifts.
  • De minimis or nominal promotional items displaying the member’s logo as long as the value of the item is “substantially below” the $300 limit.
  • Decorative items commemorating a business transaction.
  • Donations made in response to a presidentially declared major disaster.
• Systems and Procedures: Members must maintain systems and procedures reasonably designed to ensure that covered gifts are:
  • Reported to the member;
  • Reviewed for compliance with FINRA Rule 3220 by someone other than the associated person giving the gift; and
  • Recorded in the member’s books and records.

While entertainment is outside the scope of the amendments to the Gifts Rule, FINRA noted that the current guidance on business entertainment continues to apply. In particular, FINRA has stated in the past that the Gifts Rule does not prohibit ordinary and usual business entertainment that is neither so frequent nor so extensive as to raise any questions of propriety. [3]

OBSERVATIONS AND NEXT STEPS

FINRA member firms should consider reviewing and, as appropriate, updating policies, supervisory procedures, systems, and training regarding gifts and noncash compensation. Firms that revise their practices should also assess whether updates to customer disclosures are warranted, including disclosures required under Regulation Best Interest.

Despite FINRA Rule 3220 now permitting gifts of up to $300, other laws, regulations, or employer policies may still impose lower limits or additional requirements, including:

• ERISA Plan Fiduciaries: Under a US Department of Labor nonenforcement policy, gifts from one source given to a plan fiduciary having an aggregate value of less than $250 are treated as insubstantial.
• ERISA Plan Service Providers: Form 5500 reporting does not require disclosure of gifts and gratuities if the aggregate value from one source is less than $100.
• Labor Unions: A person giving gifts or payments to unions or union officials (including union pension plan trustees) must disclose them to the DOL, unless the total value is less than $250 and the payment is unrelated to the recipient’s union status.
• State and Local Governments: State and local governments have “pay to play” rules. While the rules will vary by jurisdiction, such laws commonly restrict gifts and political contributions to officials and can carry significant consequences for violations.
• Others: To the extent applicable, legal regimes such as Municipal Securities Rulemaking Board rules and the Foreign Corrupt Practices Act, as well as the SEC’s “pay to play” rule applicable to investment advisers, may independently limit or prohibit gifts.

Accordingly, firms should evaluate the broader regulatory landscape when determining whether and how to adjust their gift policies.

HOW WE CAN HELP

We are available to assist firms in assessing the impact of the amended Gifts Rule and implementing appropriate updates.