The 150-hour rule for CPA licensure is the requirement, in force in every U.S. jurisdiction, that candidates complete at least 150 semester hours of college coursework before a state board will issue a CPA license. That is roughly 30 credit hours beyond a standard bachelor’s degree.1NASBA. UAA Model Rule Requirements – Education Starting in 2025 and 2026, a growing number of states are rolling out an alternative 120-hour pathway that pairs a bachelor’s degree with additional work experience, giving candidates a second route to the same credential.
What the 150 Hours Have to Include
A typical bachelor’s degree runs about 120 semester hours. The rule adds 30 more on top. Those extra credits don’t have to come from a graduate program, and in most states they don’t have to be in any particular subject — a candidate can technically reach 150 hours with electives unrelated to accounting.2MIT Sloan. 150-Hour Rule for CPA Certification Causes a 26% Drop in Minority Entrants What matters is the total: 150 semester hours from a regionally accredited institution, with at least a bachelor’s degree completed along the way.
The accounting and business core, however, is strictly defined. The Uniform Accountancy Act’s model rules call for at least 24 semester hours of accounting coursework beyond introductory classes, with required coverage in financial accounting, auditing, taxation, and accounting information systems. The remaining accounting hours can come from electives like managerial accounting, fraud examination, data analytics, or tax planning. Candidates also need 24 semester hours of general business courses in subjects like business law, economics, management, finance, and statistics.1NASBA. UAA Model Rule Requirements – Education
Some jurisdictions layer their own requirements on top of the UAA model, such as mandatory ethics coursework or professional communications classes. If a transcript comes up short in any specific category, the board will flag it and additional classes will be required before the education is considered complete. A candidate who hits 150 hours but loaded up on unrelated electives can still fall short of the distribution minimums, so it pays to check your state board’s specific breakdown before choosing courses.
You May Not Need All 150 Hours to Sit for the Exam
A majority of jurisdictions use a split system: 120 hours (with the required accounting and business coursework) qualifies you to sit for the CPA exam, but 150 hours are still required for actual licensure.3The Center for Growth and Opportunity. Reducing a Barrier to Entry: The 120/150 CPA Licensing Rule That lets students begin testing while finishing their education, which is a real advantage given how long the exam process takes.
Not every state works this way. A handful require the full 150 hours before you can even register for the exam. Verify your state’s rule early, because it affects when you start studying and applying. And passing all four exam sections does not, by itself, make you a CPA — the education requirement and supervised work experience both have to be satisfied before a license is issued.
Ways to Reach the Credit Total
The 30-hour gap between a standard bachelor’s degree and the licensure threshold can be closed several ways, each with different costs and timelines.
- A Master of Accountancy or an MBA with an accounting concentration is the most common route. These programs are typically designed to cover CPA exam topics and satisfy the 150-hour requirement in one to two additional years.
- Some undergraduates add a second major in finance, information systems, or a related field and reach 150 hours within a five-year undergraduate plan. This avoids graduate tuition but requires early planning.
- Several universities offer post-baccalaureate certificate programs built specifically to bridge the 30-hour gap. These tend to be shorter and more targeted than a full master’s.
- For candidates focused on cost, taking elective coursework at a community college is the cheapest option. Confirm first that your state board accepts the credits and that they count toward the required subject distribution.
Whichever path you choose, the credits still have to satisfy the subject area minimums. Reaching 150 hours won’t help if your transcript is light on accounting or business courses.
The 120-Hour Alternative
The 150-hour rule is no longer the only route. In 2025, NASBA and the AICPA updated the Uniform Accountancy Act to include a 120-hour pathway: a bachelor’s degree in accounting with 120 semester hours, two years of supervised professional experience, and a passing score on the CPA exam.4NASBA. New CPA Licensure Pathways and CPA Mobility The traditional 150-hour route remains available, and it requires only one year of experience.
The trade-off is simple. Skip the extra 30 credit hours, but work an additional year under supervision before licensure. For candidates who want to start earning sooner or who face financial barriers to a fifth year of school, the math often favors the 120-hour path. For those who want a graduate degree anyway, the traditional 150-hour route still makes sense.
The UAA is a model act, not a law. Each state must pass its own legislation to adopt the new pathway, and the rollout is happening unevenly. As of early 2026, more than a dozen states have enacted or are implementing some version of the 120-hour alternative, with effective dates staggered through 2026 and 2027. Several more have proposals in progress. Adoption status is changing quickly, so check your state board directly.
Work Experience Under Either Pathway
Education and the exam alone will not get you licensed. Every state also requires supervised professional experience, and this applies under both pathways.
Under the traditional 150-hour pathway, the standard is one year of full-time experience, typically defined as around 2,000 hours, though the exact number varies. Some states set the bar as low as 1,500 hours; a few require two or three years depending on the type of work. Under the 120-hour alternative, the requirement doubles to two years.4NASBA. New CPA Licensure Pathways and CPA Mobility
A licensed CPA who supervised your work has to verify it. Acceptable experience goes beyond public accounting firms. Most states accept work in private industry (financial reporting, internal audit, management accounting), government accounting, and in some cases full-time teaching at an accredited institution. The work has to involve applying accounting skills at a professional level, not just bookkeeping or data entry.
Why the Rule Is Being Changed
The push for an alternative didn’t come out of nowhere. Research published in the Journal of Accounting Research found that the 150-hour requirement led to a 26% decline in minority candidates entering the CPA profession, compared with a 14% decline among nonminority candidates.2MIT Sloan. 150-Hour Rule for CPA Certification Causes a 26% Drop in Minority Entrants The extra year of school costs money and delays earning, and those costs fall hardest on candidates who can least afford them.
At the same time, the accounting profession is facing a well-documented pipeline shortage. The combination of fewer entrants and an aging workforce has created pressure to lower barriers that don’t clearly improve competence. Because most states never required the extra 30 hours to be in accounting-related subjects, the argument that those credits meaningfully prepare candidates for practice has weakened. The 120-hour pathway is the profession’s attempt to substitute classroom time with on-the-job experience.
Practicing in Other States
CPA licenses are issued by individual states, but a framework called substantial equivalency allows licensed CPAs to practice across state lines without getting a separate license in each state. Under Section 23 of the Uniform Accountancy Act, a CPA whose home-state requirements match the UAA standard — a 150-hour degree, one year of experience, and a passing exam score — can practice in other participating jurisdictions. All 55 U.S. accounting jurisdictions currently meet that standard.5NASBA. Substantial Equivalency
In practice, you should still contact the board in any state where you plan to work, since some jurisdictions require notification or a fee before you begin. CPAs licensed through newer alternative pathways should pay particular attention: NASBA has noted that individuals licensed through certain non-traditional routes after 2012 may not automatically qualify for mobility privileges.5NASBA. Substantial Equivalency That’s a point worth confirming before accepting work outside your home state.