Last December, we previewed the significant cost accounting and pricing data disclosure changes contained in the Fiscal Year 2026 National Defense Authorization Act (“NDAA”), including Section 1804(c)’s increase to the threshold governing the Truthful Cost or Pricing Data Statute (formerly the Truth in Negotiations Act, and still commonly called “TINA”). That change is no longer on the horizon: it is here. The FY 2026 NDAA was signed into law on December 18, 2025, and the higher TINA threshold has taken effect for contracts entered into after June 30, 2026. This post focuses on what that means, in practical terms, for prime contractors and subcontractors.
From $2.5 Million to $10 Million, But Only Going Forward
Section 1804(c) amends 10 U.S.C. § 3702 to raise the threshold for requiring certified cost or pricing data from $2.5 million to $10 million. As we noted previously, the increase is not retroactive. The statute expressly keys applicability to when a contract is entered into:
- Contracts entered into after June 30, 2026 are subject to the new $10 million threshold.
- Contracts entered into on or before June 30, 2026 remain subject to the $2.5 million threshold that governed at the time of award.
This date-of-agreement approach means the two thresholds will coexist for years. A contractor may simultaneously hold a pre-July 1 contract carrying the $2.5 million threshold and negotiate a new award carrying the $10 million threshold. And because modifications generally look to the threshold specified in the underlying prime contract, a modification to a legacy contract can still trigger a certification obligation at $2.5 million even after the statutory change.
The Statute Applies Even Before the FAR Catches Up
Contractors should not wait for the Federal Acquisition Regulation to be amended before applying the new threshold. The statutory change to 10 U.S.C. § 3702 is operative on its own terms, and contracting officers are to apply the $10 million threshold to negotiations occurring after June 30, 2026 even though the implementing FAR and DFARS rules remain in progress. Indeed, as of this writing, FAR 15.403-4 still recites the $2.5 million figure, reflecting the lag between legislative enactment and regulatory implementation. Given the lag in the FAR updates, contractors may need to remind government contracting officers or higher-tier contractors of the change.
What the Higher Threshold Does Not Change
A higher certification threshold is not a lighter evidentiary burden across the board. Moreover, even where certified cost or pricing data are no longer required, contracting officers must still determine that a price is fair and reasonable and may support this effort by requesting data other than certified cost or pricing data. Contractors should therefore continue to maintain well-organized, defensible pricing support for awards ranging from $2.5 million to $10 million. For awards that exceed $10 million, the stakes of a defective-pricing finding – which include downward price adjustment with interest, and potential False Claims Act exposure – are unchanged.
Practical Guidance for Primes and Subcontractors
- Map every action that straddles July 1, 2026. Flag pending awards, modifications, and subcontracts and confirm which threshold applies based on when the relevant contract was, or will be, entered into.
- Update proposal templates and compliance checklists. Internal instructions, pricing checklists, and subcontract templates should be revised so teams are not applying a superseded threshold.
- Subcontractors: Raise the threshold question with primes. When a prime requests certified cost or pricing data, subcontractors should take steps to understand their commitment. A subcontract entered into after June 30, 2026 may still apply the $2.5 million threshold if the prime contract was entered into on or before June 30, 2026. Subcontractor should initiate a conversation to confirm which threshold the prime is applying and whether the requested certification is actually required for the subcontract at issue.
- Primes: align flow-downs with the applicable threshold. Review flow-down clauses and pricing requests to streamline obligations and avoid unnecessary certifications while preserving the pricing support needed to defend fair-and-reasonable determinations.