EB-5 Program

What Is The EB-5 Program?

 

Speak with an Attorney today. Call us at 617-752-2371 email team@tflawllc.com or visit our contact page to get started.

 

The EB-5 program is currently the only visa program designed to allow foreign investors to gain permanent residence (a “green card”) in the United States. It requires a minimum investment of $1 million, or $500,000, if the investment is in a rural or targeted high unemployment area where unemployment is 150% of the national average. The investment also must result in the creation of at least 10 jobs.

•There are 10,000 EB-5 visas available each Fiscal Year (FY).

•To qualify for the EB-5 program, immigrants can invest directly in a job-creating business or can invest through regional centers approved by USCIS to promote economic growth in designated areas.

•If the investor’s initial application is approved, the investor can apply for conditional residence in the United States. Once approved, the conditional residence lasts two years. After two years, the investor can apply to have the conditions removed and have the conditional residency made permanent, but only if the investment has resulted in the creation of a minimum of 10 jobs, as required.

 

Requirements for creation of an EB-5 Investment

 

The investment must satisfy three main elements:

 

•An investment of capital;

•In a new commercial enterprise;

•Which creates jobs.

 

All EB-5 investors must invest in a new commercial enterprise, which is a commercial enterprise:

 

•Established after Nov. 29, 1990, or

•Established on or before Nov. 29, 1990, that is:

1. Purchased and the existing business is restructured or reorganized in such a way that a new commercial enterprise results, or

2. Expanded through the investment so that at least a 40-percent increase in the net worth or number of employees occurs.

 

Commercial enterprise means any for-profit activity formed for the ongoing conduct of lawful business including, but not limited to:

 

•A sole proprietorship

•Partnership (whether limited or general)

•Holding company

•Joint venture

•Corporation

•Business trust, or

•Other entity, which may be publicly or privately owned.

This definition1 includes a commercial enterprise consisting of a holding company and its wholly owned subsidiaries, provided that each such subsidiary is engaged in a for-profit activity formed for the ongoing conduct of a lawful business.

 

What Counts As Capital?

 

Capital means cash, equipment, inventory, other tangible property, cash equivalents and indebtedness secured by assets owned by the alien entrepreneur, provided that the alien entrepreneur is personally and primarily liable and that the assets of the new commercial enterprise upon which the petition is based are not used to secure any of the indebtedness. All capital shall be valued at fair-market value in United States dollars.

 

Qualifications of the Investment

 

•The immigrant investor must actually place his or her capital at risk. The mere intent to invest is not sufficient.

•Purchasing a share of a business from an existing shareholder, without more, will not qualify, since the payment goes to the former shareholder rather than to the new commercial enterprise.

Guaranteed Returns and Debt Arrangements

•If the immigrant investor is guaranteed a return, or a rate of return on all or a portion of his or her capital, then the amount of any guaranteed return is not at risk. [14] For the capital to be at risk there must be a risk of loss and a chance for gain.

 

Job Creation Requirments

 

An EB-5 investor must invest the required amount of capital in a new commercial enterprise that will create full-time positions for at least 10 qualifying employees.

 

•Full-time positions must be created directly by the new commercial enterprise to be counted. This means that the new commercial enterprise must itself be the employer of the qualifying employees.

•Direct jobs are those jobs that establish an employer-employee relationship between the new commercial enterprise and the persons it employs.

•Indirect jobs are those jobs held outside of the new commercial enterprise but that are created as a result of the new commercial enterprise.

•The investor must show that the number of existing employees is being, or will be, maintained at no less than the pre-investment level for a period of at least 2 years.

 

When does the 2-year period begin?

•6 months after adjudication of Form I-526. The business plan filed with the immigrant petition should reasonably demonstrate that the requisite number of jobs will be created by the end of this 2-year period.

 

Meeting the 10 Employees Requirement

 

The company must create full-time positions for qualifying employees:

 

•An employee2 is defined as a person who provides services or labor for the new commercial enterprise and who receives wages or other remuneration directly from the new commercial enterprise.

•The position must be a full-time employment position. Full-time employment is defined as employment of a qualifying employee by the new commercial enterprise in a position that requires a minimum of 35 working hours per week.

•However, the definition of full-time employment does not include combinations of part-time positions, even if those positions when combined meet the hourly requirement per week.

Job Sharing:

•A job-sharing arrangement3 whereby two or more qualifying employees share a full-time position shall count as full-time employment provided the hourly requirement per week is met.

 

What does NOT count as employment for the 10 workers requirement?

 

•Jobs that are intermittent, temporary, seasonal, or transient in nature do not qualify as permanent full-time jobs. However, jobs that are expected to last at least 2 years are generally not considered intermittent, temporary, seasonal, or transient in nature.

How Involved does the Investor Have to Be?

 

•The immigrant investor must be engaged in the management of the new commercial enterprise, either through the exercise of day-to-day managerial responsibility or through policy formulation. It is not enough that the immigrant investor maintain a purely passive role concerning his or her investment.



 

Typical Timeline of EB-5 Process

 

Invest in a Company.

Submit Application for EB-5 with Supporting Documents.

Average Processing Times are18 to 24 months. Applicant has interview with consular officer (if abroad) or USCIS Officer (if within U.S) issued.

If approved, receive conditional greencard good for 2 years.

At expiration of conditional greencard (2 years after initial application approved), must prove to government that the company has successfully hired 10 workers for periods of at least 2 years each. If approved, conditions are removed, and applicant receives a permanent greencard.

 

Speak with an Attorney today. Call us at 617-752-2371 email team@tflawllc.com or visit our contact page to get started.

 

1 This definition does not include noncommercial activity such as owning and operating a personal residence.

2 Qualifying employee is a U.S. citizen, lawful permanent resident or other immigrant authorized to work in the United States including, but not limited to, a conditional resident, a temporary resident, an asylee, a refugee, or a person residing in the United States under suspension of deportation.

3To demonstrate that a full-time position is shared by more than one employee, the following evidence, among others, may be relevant:

•A written job-sharing agreement;

•A weekly schedule that identifies the positions subject to a job-sharing arrangement and the hours to be worked by each employee under the job-sharing arrangement; and

•Evidence of the sharing of the responsibilities or benefits of a permanent, full-time position between the employees subject to the job sharing arrangement. Jobs that are intermittent, temporary, seasonal, or transient in nature do not qualify as permanent full-time jobs. However, jobs that are expected to last at least 2 years are generally not considered intermittent, temporary, seasonal, or transient in nature.

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