Rule 144 Affiliate vs Non-Affiliate: The 2026 Comparison

Which category you fall into under Rule 144 determines everything, whether you face volume caps, broker requirements, Form 144 filings, or none of the above. The affiliate/non-affiliate distinction is the single most consequential fork in the Rule 144 decision tree, and getting it wrong can turn a routine stock sale into an unregistered distribution.

This article gives you the side-by-side comparison that most resources bury or omit: all five Rule 144 conditions mapped across both seller types, the 90-day look-back trap explained with real examples, the attribution rules that expand the 10% threshold further than most people expect, and the tacking shortcut non-affiliates can use. For the full step-by-step resale walkthrough, see Rule 144 Resale Conditions: 2026 Practitioner Walkthrough.

Key takeaway: Affiliates must satisfy five Rule 144 conditions simultaneously every time they sell. Non-affiliates who have held for one year face none of them. The gap between those two outcomes is enormous, and the line between the categories is less obvious than it looks.

What Is an Affiliate Under Rule 144?

An affiliate is any person who directly or indirectly controls, is controlled by, or is under common control with the issuer, that is the operative definition in 17 CFR §230.144(a)(1). Control is the key concept, not job title or share count alone.

In practice, three categories are presumed to be affiliates:

• Officers and directors of the issuer
• Holders of 10% or more of the issuer's voting securities
• Anyone else who can demonstrably direct the issuer's management or policies

The officer/director presumption is strong. The 10% ownership presumption is rebuttable, but rebutting it requires a separate legal opinion addressing the lack of control, and practitioners note that this is difficult in practice even when the facts arguably support it.

As Laura Anthony, Esq. of Anthony, Linder & Cacomanolis, PLLC puts it: "Rule 144 sets forth different conditions for sellers that are 'affiliates' or a person that has been an affiliate in the past 90 days then for those who are not and have not been affiliates."

The Attribution Rules That Expand the 10% Threshold

This is where most online resources fall short. The 10% calculation is not just your personal share count. Under Rule 144(a)(2), you must aggregate:

• All voting securities you personally own, benefit from, or have the right to vote
• Your spouse's holdings
• Holdings of minor children and parents who share your home
• Holdings of any trust where you serve as trustee, any estate where you serve as administrator, and any company where you are a director, executive officer, or 10%+ owner
• Any non-voting securities (including convertible debt) that are convertible into voting securities within the next 12 months

A CFO who personally owns 6% of the company but whose spouse owns another 5% is over the threshold. A director who holds 8% directly but also serves as trustee of a family trust holding 4% is over the threshold. The attribution rules are broad enough that many people who believe they are non-affiliates are not.

What Is a Non-Affiliate?

A non-affiliate is anyone who does not control, and is not controlled by or under common control with, the issuer, and has not been an affiliate within the past 90 days. That second condition is the trap most people miss.

The 90-Day Look-Back Rule: The Most Overlooked Trap

A person who was an affiliate within the past 90 days is still treated as an affiliate for Rule 144 purposes, per the SEC's Rule 144 guidance. The clock starts running only after affiliation actually ends.

Two concrete examples:

1. The recently resigned CFO. A CFO resigns on September 1, 2026. She cannot sell as a non-affiliate until November 30, 2026, 90 days later. Any sale before that date requires full affiliate compliance: current public information, volume limits, broker transaction, and Form 144.

2. The director who sold down below 10%. A director held 12% of a company's voting stock and sold shares in August 2026, dropping his personal stake to 8%. If attribution rules no longer push him above 10% after accounting for family and entity holdings, he may have ceased to be an affiliate, but he still cannot sell as a non-affiliate until 90 days have passed.

The 90-day rule catches former insiders who assume their resignation or share sale immediately frees them from affiliate restrictions. It does not.

Rule 144 Affiliate vs Non-Affiliate: The Full Conditions Comparison

This is the table that no top-ranking source provides in full. All five Rule 144 conditions, mapped across affiliates and both non-affiliate holding period windows.

Sources: SEC Rule 144 investor guidance; 17 CFR §230.144; SEC Release No. 33-8869 (effective February 15, 2008).

The holding periods above reflect the 2008 amendments, which shortened the affiliate period from one year to six months (for reporting company securities) and the non-affiliate period from two years to one year. No further amendments have been adopted as of September 2026.

Restricted Securities vs Control Securities: A Critical Distinction

Before going deeper on each seller category, one distinction needs to be clear, because confusing these two terms leads to real compliance errors.

Restricted securities are securities acquired in unregistered transactions, private placements, Regulation D offerings, Rule 144A transactions. The restriction is a property of how the securities were acquired, not who holds them. Any holder, affiliate or not, can hold restricted securities.

Control securities are securities held by affiliates, regardless of how they were acquired. An affiliate who buys shares in the open market at market price, through their brokerage account, holds control securities. Those shares carry no restrictive legend, but they are still subject to Rule 144 conditions when the affiliate sells.

This surprises many insiders. As the SEC's guidance confirms, affiliates selling control securities (freely tradeable shares acquired in the open market) do not face a holding period requirement, but they must still satisfy the other four conditions: current public information, volume limits, manner of sale, and Form 144. The holding period only applies to restricted securities.

When an affiliate holds restricted securities, both sets of requirements apply simultaneously.

Affiliate Conditions: What They Actually Mean in Practice

Current Public Information

The issuer must be current in its Exchange Act reporting obligations, annual reports, quarterly reports, and current reports must all be filed. If the issuer is delinquent in its filings at the time of the planned sale, Rule 144 is unavailable to affiliates even if every other condition is met. This is a real operational risk for affiliates of smaller reporting companies that occasionally miss filing deadlines.

Volume Limitations

Affiliates can sell no more than the greater of these two amounts in any three-month period:

• 1% of the outstanding shares of the class being sold, or
• The average weekly reported trading volume during the four calendar weeks preceding the filing of Form 144 (or the date of sale, if no Form 144 is required)

For debt securities, the cap is 10% of the principal amount of the tranche.

Worked example: Company X has 10 million shares outstanding. 1% equals 100,000 shares. The average weekly trading volume over the preceding four weeks was 80,000 shares. The four-week total is 320,000 shares. The volume limit is therefore 320,000 shares per quarter, because the trading volume measure (320,000) exceeds the 1% measure (100,000).

Critically, this limit aggregates sales by the affiliate and all related persons, spouse, co-resident relatives, trusts and estates where the affiliate or related persons collectively hold 10%+ of beneficial interest, and entities where the affiliate and related persons collectively own 10%+ of equity. Routing sales through a spouse or a family LLC does not reset the clock.

For a detailed breakdown of the volume limit mechanics, see Rule 144 Volume Limitations: A 2026 Practitioner Walkthrough.

Manner of Sale

Affiliates selling equity securities must use one of three channels:

1. Broker transactions, the broker executes the order as agent, receives only normal commissions, and does not solicit buy orders
2. Direct transactions with a market maker
3. Riskless principal transactions

Affiliates cannot sell directly to buyers in negotiated private transactions without registration. The broker acts as a gatekeeper, which is why practitioners emphasize that arrangements for a Rule 144 opinion letter and broker representation letter must be coordinated through the affiliate's broker before the sale.

Form 144 Filing

Affiliates must file Form 144 with the SEC concurrently with placing the sell order when the proposed sale in any three-month period exceeds 5,000 shares or $50,000 in aggregate sale price. For exchange-listed securities, a copy must also be filed with the relevant exchange. The form is typically prepared and submitted by the broker on the affiliate's behalf. Non-affiliates never file Form 144.

For the full mechanics of Form 144, see Form 144 Explained: What It Is, Who Files It, and Why.

Non-Affiliate Conditions: Far Simpler, With One Key Nuance

The Six-to-Twelve-Month Window

A non-affiliate who has held restricted securities for at least six months but less than one year can sell under Rule 144 only if the issuer is a reporting company and current public information is available. Volume limits, manner-of-sale requirements, and Form 144 do not apply. The sale can be made directly to any buyer.

After One Year: No Conditions Apply

Once a non-affiliate has held restricted securities for at least one year, Rule 144 imposes no conditions whatsoever. No volume limits. No broker requirement. No Form 144. No current public information requirement. The non-affiliate can sell any quantity, in any manner, to any buyer.

This is the starkest difference between the two categories. An affiliate who has held for years still faces all five conditions on every sale. A non-affiliate who crosses the one-year mark sells freely.

Tacking: The Non-Affiliate Shortcut Most Resources Miss

Non-affiliates can shorten their effective holding period through tacking, adding a prior non-affiliate holder's holding period to their own. The SEC's guidance states explicitly: "If you purchased restricted securities from another non-affiliate, you can tack on that non-affiliate's holding period to your holding period."

Worked example: Seller A (a non-affiliate) acquired restricted shares in a private placement and held them for eight months, then sold them to Buyer B (also a non-affiliate). Buyer B can immediately tack Seller A's eight months. Buyer B needs to hold for only four more months to reach the one-year threshold, not a full year from their own acquisition date.

Two important limits on tacking:

• Tacking is not available when purchasing from an affiliate. If Seller A was an affiliate at the time of sale, Buyer B's holding period starts fresh from their own acquisition date.
• The tacking rule applies to the seller's status at the time of the transfer, not at the time of the original issuance.

For a full treatment of holding period mechanics, see Rule 144 Holding Period: 2026 Practitioner Walkthrough.

The Shell Company Carve-Out: Rule 144 Is Unavailable

One gap that most online resources leave open: Rule 144 does not apply at all to restricted securities of blank check companies or shell companies (other than business combination-related shell companies), per the SEC's guidance. This applies to both affiliates and non-affiliates.

For a former shell company that has since ceased to be a shell, Rule 144 becomes available only after:

• The company has been a reporting company for at least 12 months, and
• At least one year has elapsed since the company filed a Form 8-K reflecting its status as a non-shell (the "Super 8-K" or Form 10-equivalent disclosure)

This carve-out catches investors in SPACs post-combination, reverse merger vehicles, and OTC shell companies who assume the standard holding period rules apply. They do not.

The Section 16 Interaction: An Overlooked Layer for Affiliates

Affiliates who are also officers, directors, or 10%+ holders face a compliance layer that Rule 144 does not address: Section 16 of the Exchange Act. Officers, directors, and 10%+ beneficial owners must report transactions on Form 4 within two business days, and any profit from a purchase and sale (or sale and purchase) of issuer equity within any six-month period is subject to disgorgement under the short-swing profit rule.

A Rule 144-compliant sale by an affiliate can still trigger a Section 16 short-swing profit liability if a matching purchase occurred within the prior six months. These two frameworks operate independently. For the mechanics of short-swing profit calculations, see Short-Swing Profit Rule Calculation: The Complete Practitioner Walkthrough.

The Practical Workflow: Opinion Letters and Legend Removal

Regardless of whether a seller is an affiliate or non-affiliate, transfer agents routinely require a Rule 144 opinion letter from securities counsel before removing the restrictive legend from a stock certificate or DRS position. This is a practical bottleneck that is separate from the legal requirements of Rule 144 itself.

For affiliates, the opinion letter is always required, and the process runs through the broker:

1. Affiliate instructs broker of intent to sell
2. Broker coordinates with issuer's or seller's securities counsel for a Rule 144 opinion letter
3. Broker prepares and submits Form 144 (if the threshold is met)
4. Transfer agent removes the legend on restricted shares upon receipt of the opinion
5. Sale executes as a broker transaction

For non-affiliates, the opinion letter is not legally required by Rule 144 but is almost always demanded by the transfer agent in practice. Engaging counsel early avoids delays that can cost sellers real money if the stock price moves during the legend-removal process.

FAQ

Does Rule 144 apply to non-affiliates? Yes, but with far fewer conditions. Non-affiliates who have held restricted securities for six to twelve months need only satisfy the current public information requirement (for reporting issuers). After one full year, non-affiliates face no Rule 144 conditions at all and can sell freely in any amount.

What makes someone an affiliate under Rule 144? Control of the issuer, directly or indirectly. Officers, directors, and holders of 10% or more of voting securities are presumed affiliates. The 10% calculation includes holdings attributed from spouses, co-resident relatives, trusts, estates, and controlled entities, plus convertible securities exercisable within 12 months.

I resigned as a director last month. Am I still an affiliate? Yes. The 90-day look-back rule means you remain subject to affiliate conditions for 90 days after ceasing to be an affiliate. You cannot sell as a non-affiliate until that period expires.

What is the volume limit for affiliates under Rule 144? The greater of 1% of the outstanding shares of the class, or the average weekly reported trading volume over the four calendar weeks preceding the Form 144 filing (or the date of sale), measured per three-month period. Sales by the affiliate's spouse, co-resident relatives, and controlled entities count toward the same limit.

Can non-affiliates use tacking to shorten the holding period? Yes. A non-affiliate who purchases restricted securities from another non-affiliate can add the seller's holding period to their own. If the prior holder had already held for eight months, the new holder needs only four more months to reach the one-year threshold. Tacking is not available when purchasing from an affiliate.

Does Rule 144 apply to shell company securities? No. Rule 144 is not available for restricted securities of blank check companies or shell companies. For former shell companies, a one-year seasoning period after the Form 8-K non-shell disclosure is required before Rule 144 becomes available.

Do non-affiliates ever need to file Form 144? Never. Form 144 is an affiliate-only obligation. Non-affiliates are exempt regardless of the size of their sale.