The Revolutionary FAR Overhaul is a government-wide rewrite of the Federal Acquisition Regulation, the rulebook that governs how the federal government buys goods and services. It is the most significant change to federal procurement rules in more than 40 years. Some of its biggest changes are already in effect: the dollar thresholds that decide which contracts get fast, light-touch treatment rose on October 1, 2025. The next change, a higher threshold for when contractors must hand over certified cost and pricing data, takes effect June 30, 2026. For a small business, the short version is this: more federal work is moving into faster, simpler buying lanes, and the contractors who understand the new rules first will be the ones positioned to win it.
Here is where the thresholds actually stand, why they matter if you sell to the government, and what to do about it.
What is the Revolutionary FAR Overhaul?
The Federal Acquisition Regulation, or FAR, is the rulebook every federal agency follows when it buys anything, from laptops to launch services. Over four decades it grew into thousands of pages, and a lot of those pages are rules the law never actually required.
The Revolutionary FAR Overhaul is the government's project to strip it back down. It began with Executive Order 14275 in April 2025, "Restoring Common Sense to Federal Procurement." The official goal, in the FAR Council's own words, is to "return the FAR to its statutory roots, rewrite it in plain language, and remove most non-statutory rules." You can read the government's own summary on the official Revolutionary FAR Overhaul page at acquisition.gov.
In practice, the overhaul does four things:
- Removes non-statutory rules. It keeps the requirements Congress actually mandated and moves much of the optional "how-to" guidance out of the FAR itself.
- Rewrites the rules in plain language. Dense, layered text is being replaced with clearer, shorter wording.
- Raises dollar thresholds. More contracts now qualify for fast, simplified buying procedures, which is the change small businesses will feel most directly.
- Gives contracting officers more discretion. The system leans less on rigid checklists and more on the contracting officer's judgment.
It is rolling out in two phases:
- Phase 1, in effect: Agencies adopt the new rules immediately through what are called class deviations. These are interim, but they carry full force the moment an agency issues them, and many agencies already have.
- Phase 2, ongoing: The government publishes formal rules to make the changes permanent. New entries hit the Federal Register regularly through 2026.
The practical takeaway for a small business is that you do not have to wait for the "permanent" version. The rules are already changing the contracts you bid on. For the wider view of everything the overhaul touches, see our full breakdown of the Revolutionary FAR Overhaul. This guide stays focused on what it means for small businesses.
Which thresholds changed, and when
The headline changes are the dollar thresholds that determine how the government is allowed to buy. When a purchase falls under a threshold, the agency gets to use faster, simpler procedures with less paperwork on both sides. Three of these rose on October 1, 2025, and are in force now. A fourth takes effect June 30, 2026:
| What it controls | Old threshold | New threshold | In effect |
|---|---|---|---|
| Micro-purchase threshold (buys an agency can make with almost no process) | $10,000 | $15,000 | Oct 1, 2025 |
| Simplified Acquisition Threshold (SAT), the line for fast, streamlined procedures | $250,000 | $350,000 | Oct 1, 2025 |
| Simplified procedures for certain commercial items | $7.5 million | $9 million | Oct 1, 2025 |
| Certified cost or pricing data (TINA), i.e. when you must open your books | $2.5 million | $10 million | June 30, 2026 |
The first three are already shaping the contracts on the street today. The fourth, the certified cost and pricing data threshold, comes from the fiscal year 2026 National Defense Authorization Act and applies to contracts entered into after June 30, 2026. After that date, work under $10 million no longer triggers the certified cost and pricing data requirement.
There are further changes aimed at larger firms, including higher triggers for the Cost Accounting Standards. Most small businesses operate well below those levels, so the thresholds above are the ones that will actually touch your next bid.
Why these changes matter to a small business
Raising a threshold sounds like accounting trivia, but it is not. Each of these lines decides how hard it is for an agency to give you money.
When more contracts fall under the Simplified Acquisition Threshold, agencies can award them faster, with less competition paperwork and shorter timelines. The jump from $250,000 to $350,000 pulls real work into that faster lane. The micro-purchase increase means more routine buys can come straight to a capable vendor with almost no process at all. And lifting the certified cost and pricing data requirement to $10 million means contracts that used to force you to open your books no longer do, which lowers the cost of competing for mid-sized work.
There is a flip side worth naming. Faster, simpler buying favors the contractor an agency can already find and trust without much digging. If your registration is current and your positioning is clear, that speed works for you. If it is not, the same speed works against you, because the award is gone before you are ready to chase it.
The clause renumbering nobody is talking about
One change inside the overhaul creates a small, avoidable risk. The FAR's clause numbers are being reorganized, and new solicitations are already referencing the updated structure.
If your proposal templates, compliance matrices, or capability statements cite specific FAR clause numbers, some of those references may now point to the wrong place. That is the kind of mismatch that makes a proposal look careless to an evaluator, or gets it ruled non-responsive on a technicality. Before your next submission, check that every clause you cite still matches the current solicitation.
What about set-asides and the 8(a) program?
Small business set-asides and the "Rule of Two" are still in effect. But the broader direction of federal procurement is shifting toward a merit-first emphasis, and the numbers show it.
The SBA's FY25 scorecard, released June 25, 2026, reported that small businesses won $179 billion in prime contracts, about 27.9 percent of all federal prime dollars, comfortably above the 23 percent goal. Within that total, though, the 8(a) program saw its largest drop in more than a decade, falling $1.5 billion to $24.3 billion. Set-asides are not disappearing, but building your whole strategy around a single program is riskier than it was a year ago.
What small businesses should do now
- Confirm your SAM.gov registration is active and current. Refresh it well ahead of any solicitation you plan to answer, ideally 60 to 90 days out. If you are not sure your profile is in order, our guide to getting your business ready in SAM.gov walks through it step by step.
- Update your proposal templates and compliance matrices for the renumbered clauses so you are not citing outdated references.
- Re-map which of your target contracts now fall under simplified procedures. Work that used to move slowly may now move fast, and your pipeline timing should reflect that.
- Watch for new class deviations. Agencies are adopting the changes on a rolling basis, so the rules can shift between bids.
- Get a second set of eyes on what the changes mean for your specific NAICS codes and contract sizes. The thresholds are universal; the impact on your business is not.
- Consider weighing in while the rules are still open. The government published a fresh set of proposed FAR rules on June 23, 2026, with a public comment window through July 23, 2026, at regulations.gov. Small businesses rarely file comments, which means the firms that do get a louder voice in how the final rules land.
How FEDCON helps
FEDCON helps small businesses turn federal procurement rules into a plan they can actually act on, from SAM.gov registration to positioning for the work these changes are speeding up. If you want to know exactly what these changes mean for your business, talk to a FEDCON advisor. You can also reach our Help Desk at 1-855-233-3266.
Frequently asked questions
What is a FAR overhaul? A FAR overhaul is a rewrite of the Federal Acquisition Regulation, the rulebook every federal agency follows when it buys goods and services. The current effort, called the Revolutionary FAR Overhaul, is the most significant change to federal procurement rules in more than 40 years. It removes non-statutory rules, rewrites the remaining ones in plain language, and gives contracting officers more discretion.
Is the FAR being rewritten? Yes. The FAR is being rewritten part by part under Executive Order 14275, signed in April 2025. The government adopts changes immediately through class deviations, then publishes formal rules to make them permanent. The existing FAR still governs a contract until the new rule for that part takes effect.
What are the changes in FAR 2026? The main 2026 changes are higher dollar thresholds and a shift toward contracting-officer discretion. The Simplified Acquisition Threshold rose to $350,000 and the micro-purchase threshold to $15,000, both effective October 1, 2025. The certified cost and pricing data threshold rises to $10 million for contracts entered into after June 30, 2026. New proposed rules continue to publish throughout the year.
Is there a DFARS overhaul? Yes. The Defense Federal Acquisition Regulation Supplement, or DFARS, which applies to defense contracts, is being revised alongside the FAR. The Department of War issued dozens of DFARS class deviations that took effect in early 2026, mirroring the broader overhaul.
Does the FAR Overhaul eliminate small business set-asides? No. Small business set-asides and the Rule of Two remain in effect. The broader emphasis is shifting toward merit-based competition, but set-aside programs have not been eliminated.
What is Executive Order 14275? Executive Order 14275, "Restoring Common Sense to Federal Procurement," was signed in April 2025 and directed the government to rewrite the FAR in plain language and remove rules not required by law. It launched the Revolutionary FAR Overhaul.
Do I need to re-register in SAM.gov because of the FAR Overhaul? The overhaul does not require a brand-new registration, but you should confirm your existing SAM.gov registration is active and up to date before bidding, since accurate registration is still required to win federal work.
Sources
- Acquisition.gov, "Revolutionary FAR Overhaul," acquisition.gov/far-overhaul
- Federal Register, "Revolutionary Federal Acquisition Regulation Overhaul," June 23, 2026
- U.S. Small Business Administration, "SBA Releases FY25 Scorecard for Small Business Contracting," June 25, 2026
- Executive Order 14275, "Restoring Common Sense to Federal Procurement," April 2025