FTC Funeral Rule compliance: what a buyer inherits and how to audit it

A funeral home’s price lists look like paperwork. To a buyer they are a record of how the firm sells, and the FTC Funeral Rule turns that record into legal exposure. The FTC’s compliance guide for providers, last updated in January 2025 for inflation adjustments, cites penalties of up to $53,088 per violation.

This guide is the audit procedure we use. Our funeral home due diligence guide explains where this audit fits among the other workstreams, and the buyer’s guide hub covers the full purchase.

What exactly does a buyer inherit under the FTC Funeral Rule?

You inherit the documents and the habits in every deal, and in a stock purchase you also inherit the entity’s history. The Rule applies to any “funeral provider,” meaning anyone who sells both funeral goods and funeral services.

In an asset purchase, past violations generally stay with the seller. But the day after closing, the GPL on the arrangement desk, the statement form in the software, and the way the night staff answer the phone become yours. If they are wrong, the violation is now your own. Ask your attorney for a specific indemnity covering pre-closing conduct, and ask the seller whether the firm has ever received an FTC warning letter or entered the Funeral Rule Offenders Program.

That program is real. In June 2020 the FTC reported that 17 of 90 funeral homes visited undercover since 2018 failed to give timely itemized price disclosures. All 17 entered the program, which NFDA runs, instead of facing possible civil penalties.

What is the current status of Funeral Rule rulemaking?

The 1994 version of the Rule still governs. The FTC published an advance notice of proposed rulemaking on Nov. 2, 2022 asking whether providers should be required to display or distribute prices online, and it held a public workshop on Sept. 7, 2023.

No proposed rule or final rule has been issued since. Online price posting is not required; it is only under consideration from the 2022 ANPR. The FTC’s May 14, 2026 paperwork notice describes the current requirements as a General Price List, casket and outer burial container price lists, phone price disclosure, and a Statement of Funeral Goods and Services Selected, with no website requirement. Its September 2025 regulatory agenda also says the agency is considering “further deregulatory actions.”

For a buyer, that means two things. Do not budget for a federal web-posting mandate as if it were certain. And do not accept a seller’s claim that posting prices online makes the firm compliant, because the Rule tests what happens at the arrangement table and on the phone.

How do you audit the General Price List line by line?

Compare every GPL version used in the last year to the requirements of 16 CFR Part 453. Most defects fall into a handful of predictable places.

The FTC guide adds that list prices must reflect what families actually pay. If most families receive a “discount,” the discounted figures are the real prices. Our General Price List definition covers the 16 required items.

Casket and outer burial container lists

Under §453.2(b)(2) and (3), each list needs the firm’s name, a caption, an effective date, and the retail price of every model offered without special order. Walk the selection room with the list in hand and confirm every displayed model appears on it. The vault list must carry the outer burial container disclosure from §453.3(c)(2).

Preneed price lists

Ask whether the firm uses a separate GPL for preneed sales, and audit it the same way. The FTC guide says a GPL must be given in every preneed situation. A preneed list may differ from the at-need list, but it must carry all required disclosures and itemized prices, and a firm cannot offer only packages to preneed buyers. In our experience, preneed sales agents often carry older forms, so collect the version each agent actually hands out, not the one in the office binder.

How do you test telephone price disclosures?

Make your own calls. The Rule requires staff to give callers accurate information from the price lists, and the FTC guide says callers cannot be required to give their names or come in person.

The FTC’s own testing shows why this matters. Its November 2024 phone-sweep staff report covered 278 providers. Staff could not get prices after hours from 26% and during business hours from 7%. At least 33% gave package prices without itemized prices.

1. Write a three-question script: the direct cremation price, the basic services fee, and the least expensive casket.
2. Call during business hours, on a weekday evening, and on a weekend.
3. Reach at least two different staff members or the answering service.
4. Record each answer and compare it with the GPL in effect that day.
5. Note any demand for a name, a callback number, or an in-person visit before prices are given.

How do you audit the statements families sign?

Pull a sample of signed Statements of Funeral Goods and Services Selected and test each against §453.2(b)(5) and the required disclosures. Statements show what was actually sold, which the GPL cannot.

Check that each statement itemizes goods, services, and cash advance items with a total. It must carry the “charges are only for those items” disclosure, the embalming disclosure, and, where the firm marks up or earns a rebate on cash advances, the “we charge you for our services in obtaining” sentence. Any legal, cemetery, or crematory requirement cited to a family must be explained in writing.

Read embalming approvals closely. The FTC guide says “family consent” alone does not state the reason for embalming. The Rule also applies to preneed: survivors who change a prepaid plan or owe more must receive the price lists and a new statement. Section 453.6 requires keeping price lists for at least one year after last use and each statement for one year after the arrangement conference.

Our buyer due-diligence request list folds these items into the full request, and our guide to checking complaint history covers the board records.

How should audit findings change the deal?

Paper defects usually become closing conditions or post-closing covenants. Billing practices that break the Rule are different, because fixing them can remove revenue you priced into the offer.

Bring findings to the seller with the rule citation and the sample evidence. Our guide to negotiating price with diligence findings shows how to turn them into a price change, escrow, or indemnity without stalling the deal.