One of the most common questions organizations ask about CMMC is straightforward.
How do we know which CMMC level applies to us?
The answer is not based on company size or how long you have worked with the Department of War. It comes down to the contract and the type of data involved.
Many organizations assume CMMC requirements are figured out after a contract is awarded. That assumption creates problems.
CMMC levels are determined before award and written directly into contract language. Over time, organizations that misunderstand this often prepare for the wrong level or delay preparation entirely. By the time the requirement is clear, eligibility is already at risk.
How the Department of War Determines the Required CMMC Level
The Department of War assigns the required CMMC level based on the information handled under the contract.
Contracts involving Federal Contract Information typically require a lower CMMC level. Contracts involving CUI trigger higher requirements and alignment with NIST SP 800-171.
When CUI is involved, CMMC Level 2 applies. That means documented controls, defined scope, and evidence to support compliance. The required level is stated directly in the solicitation or contract. When it appears, it becomes a condition for award.
Where Organizations Find the Required CMMC Level
Organizations do not need to guess which CMMC level applies.
The required level is listed in the solicitation, contract clauses, or cybersecurity requirements section. These sections identify the CMMC level and whether a self-assessment or third-party certification is required.
For subcontractors, CMMC requirements may be flowed down by the prime. If your organization handles FCI or CUI in support of a prime contract, the same requirements often apply.
Understanding CMMC Levels and Scope
CMMC Level 1 applies to organizations handling Federal Contract Information only. It requires basic safeguarding practices and an annual self-assessment.
CMMC Level 2 applies to organizations handling CUI. It requires implementation of all NIST 800-171 controls, documented policies and procedures, and either a self-assessment or third-party certification depending on the contract.
Scope matters. Only systems that store, process, or transmit covered data are in scope, and that scope must be clearly defined in the System Security Plan.
What Organizations Must Do Before Award
If a contract includes a CMMC requirement, compliance must already be in place.
For CMMC Level 1 and CMMC Level 2 self-assessment contracts, organizations must complete the required assessment and submit accurate results in SPRS. For CMMC Level 2 contracts designated as requiring certification, a valid third-party assessment must be completed before contract award.
There is no grace period. If the required level is not met at the time of award, the organization is not eligible.
Consequences of Getting the CMMC Level Wrong
Preparing for the wrong CMMC level can have real consequences.
Proposals may be removed from competition. Awards may be delayed or canceled. Subcontractors may be replaced if they cannot meet flow-down requirements.
Inaccurate claims about compliance, SPRS scores, or NIST 800-171 implementation increase audit and enforcement risk. Documentation and proof matter just as much as technical controls.
CMMC Level Determination Is Predictable Once You Know What to Look For
CMMC can feel complex, but level determination follows a consistent pattern.
Once organizations understand how data type, contract language, and scope work together, preparation becomes manageable.
Organizations that prepare early have an advantage.
They know which level applies before bidding. They scope systems correctly. They avoid last-minute remediation and stay eligible as requirements expand across Department of War contracts.
Preparation removes uncertainty and reduces disruption.
Why Waiting for the Contract Is a Costly Mistake
Many organizations wait for a contract to tell them which CMMC level they need. By the time that happens, it is often too late.
CMMC Level 2 requirements are expected to be fully enforced by November 2026. Organizations that wait until contracts require CMMC Level 2 will be forced to move fast, fix gaps under pressure, and spend far more than planned. In many cases, fast-track CMMC implementation can cost three to five times more than a planned approach.
Rushing creates risk. Documentation is incomplete. Controls are poorly implemented. Decisions are made to meet deadlines instead of long-term compliance. This leads to higher costs, audit risk, and lost eligibility.
The smarter approach is to prepare now.
Organizations that begin working toward CMMC Level 2 early can spread costs over time, make better technical decisions, and avoid emergency remediation. Early preparation also positions organizations for future requirements. In some cases, CMMC Level 3 requirements are already being discussed for higher-risk work.
CMMC is not moving backward. Over time, most government contracts are expected to require at least CMMC Level 2. Organizations that act now will be ready when requirements expand. Those that wait may find themselves scrambling when compliance becomes mandatory.
Preparation today costs less than panic tomorrow.
If you are unsure which CMMC level applies to your contracts, start with readiness.
FAQ: CMMC Levels and Contract Requirements
How do I know if my contract includes CUI?
Contract language and requirements sections identify whether CUI is involved. Supporting clauses and data markings also provide guidance.
Can one organization need more than one CMMC level?
Yes. Different contracts may require different levels depending on the data handled.
Does a high SPRS score mean we are compliant?
No. SPRS scores must be supported by documentation and actual control implementation.
Do CMMC requirements apply to subcontractors?
Yes. Requirements can flow down to subcontractors handling covered information.
Can we fix gaps after award?
No. If a CMMC level is required, compliance must be met before award.
