How Should Small Businesses Prepare for FAR Dollar Threshold Adjustments?
Small businesses should review the Oct. 1, 2025 FAR threshold table, update bidding and reporting workflows, and note that adjusted thresholds can apply to existing contracts.
AI-assisted and automatically checked against the linked primary sources.
What should small businesses review before the threshold changes take effect?
According to FAR 1.109, the FAR Council must periodically adjust statutory acquisition-related dollar thresholds for inflation every five years using CPI-U, and that adjustment supersedes any other law that provides for threshold inflation updates. The Acquisition.gov threshold table effective October 1, 2025 shows changes that can affect small businesses, including the micro-purchase threshold, simplified acquisition threshold, subcontract reporting thresholds, subcontracting plan thresholds, cost or pricing data thresholds, and several competition and justification thresholds. Small businesses should map active bids, contracts, and subcontracts to those thresholds, then update proposal templates, pricing reviews, compliance checklists, and reporting calendars before the effective date. FAR 1.109 also states that an adjusted threshold applies to contracts and subcontracts without regard to award date, so a change can affect performance after award and continue for the remaining term unless another adjustment occurs. The practical response is to treat this as a procurement compliance update, not as a benefits COLA change.
Do the adjusted thresholds apply to existing contracts and subcontracts?
- Review the October 1, 2025 threshold table against your bids, awards, and subcontracting flowdowns.
- Update internal controls for thresholds tied to reporting, pricing, and subcontracting plans.
- Expect the adjusted threshold to apply during contract performance even when the award was made earlier.
- Limit your planning to acquisition-related thresholds; the cited sources do not address retirement COLA.
Compare active and pending procurements against the October 1, 2025 threshold changes and update compliance checklists before the next proposal or modification.
Process
- 1
Review the official threshold table
Use the October 1, 2025 Acquisition.gov table to identify which thresholds changed and which FAR citations they affect.
- 2
Map your obligations
Check whether your bids, subcontracts, reporting duties, or subcontracting plans are tied to the changed thresholds.
- 3
Update controls before the effective date
Revise templates, review gates, calendars, and compliance checklists so the new thresholds are reflected in proposals and performance management.
- 4
Track existing awards
Remember that an adjusted threshold can apply to contracts and subcontracts already awarded and remain in effect for the rest of the term unless changed again.
Important limitation
The supplied evidence is acquisition-specific. It covers FAR dollar threshold adjustments and their effect on procurement and subcontracts; it does not provide guidance on retirement benefits or employee COLA.
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