EB-5 Visa

EB-5 investors must invest funds in a new commercial enterprise. A new commercial enterprise is defined as a for-profit entity conducting lawful business that was established after November 29, 1990.

Businesses established prior to this date may qualify as long as the business is restructured, or the net worth of the company is increased by 40% with the investment. There are various types of for-profit entities including, sole proprietorships, joint ventures, partnerships, corporations, holding companies and/or other publicly or privately owned entities.

EB-5 investors must invest a minimum of $1 million or a minimum of $500,000 if the investment is in a Targeted Employment Area (TEA). TEAs are designated undeserved areas such as a rural area or any area that has high unemployment of at least 150% of the national unemployment rate. The new commercial enterprise must principally do business in this area to qualify for the lower investment amount

In addition to the required investment amounts, EB-5 investors must also ensure that their new commercial enterprise creates at least 10 full-time employment positions.

If the enterprise is considered a troubled business an investor may focus on job maintenance. Troubled business classification requires that the company show at least a net 20% loss for the previous 12-24 months.

The created positions must employ US citizens, permanent residents, or individuals otherwise legally authorized to work in the US. The positions must require a minimum of 35 working hours a week. Two or more qualified employees sharing a full-time position is acceptable, but part time positions, regardless of total hours, are not allowed.

Similarly, temporary/season positions are also not accepted. It is important to note that employment positions cannot be filled by the immigrant investor, their immediate family members, or any non-citizen not authorized to work in the US. The EB-5 investor is also required to take an active role in the commercial enterprise. The investor must have a managerial or policy-making role in the business.

EB-5 investors also have the option of investing their required funds in specially designated and government approved regional centers. EB-5 regional centers are USCIS-approved, public or private agencies that promote economic growth in the US through various investment and development programs and/or projects.

These agencies receive special regional center designation and are then able to receive capital from immigrant investors for their projects. These agencies/projects are vetted to ensure that the regional center is promoting growth, job creation, and adhere to the EB-5 program standards. EB-5 investors must ensure that they use an approved regional center for their investment.

USCIS maintains a list of approved regional centers as well as a list of terminated regional centers. EB-5 regional center investors do not have to take on a direct managerial role as their investment in an approved regional center is accepted as management work.

The source of the funds used to make the EB-5 investment must come solely from the foreign applicant/investor. USCIS will also require documentation to show that the source of these funds came from legal sources and by legal means. Detailed evidence will need to be provided to show that all assets, funds, capital, and/or cash used can be traced back to their lawful origination point.

Lawful sources of funds can include salaries and company payouts, investments, retirement funds, inheritance, sale of assets, gift funds, among other options. Investors should consult an attorney to ensure that their source of funds will be accepted by USCIS and to ensure that correct documentation is available and provided. Investments can be made in cash or cash equivalents, or some combination. For the purposes of EB-5, funds must be put at partial or total risk.

This means that funds are spent or invested in such a way that if the associated business does badly the investor could lose the allotted funds. Funds invested in an EB-5 regional center program are considered put at risk. Source of funds is one of the most critical parts of an EB-5 case. It can also be one of the most complex and time-consuming parts. Investors should work closely with an experienced attorney to ensure that their source of funds and case is correctly completed.

Applicants must first complete and file Form I-526, Immigrant Petition by Alien Investor. Once Form I-526 is approved, an applicant must file the next form based on where they are located. Individuals abroad must complete and file DS-260, Application for Immigrant Visa and Alien Registration. Once this form is reviewed and approved, the applicant will be given a visa to enter the US.

Individuals in the US with legal status must complete and file Form I-485, Application to Register Permanent Residence or Adjust Status. Once Form I-485 is approved or an EB-5 applicant enters the US on the relevant visa, USCIS will grant conditional permanent residency to the EB-5 investor and derivative family.

This conditional permanent residency will be valid for two years. Applicants can petition for the removal of the conditional timeframe by completing and filing Form I-829, Petition by Investor to Remove Conditions on Permanent Resident.

This earliest this petition can be filed is withing a 90-day period before the end of the 2-year conditions. Once approved, USCIS will remove conditions after which standard permanent residency status will apply. Applicants may later petition for US citizenship provide all other associated requirements are met for citizenship.