While there are many visa options available to foreign investors, such as visitor for business (B-1), treaty investor (E-2), treaty trader (E-1), or intra-company transfers (L-1), these options are all nonimmigrant visas. In other words, they authorize a temporary stay and each has its own restrictions associated with it, e.g., eligibility for the E-1 or E-2 nonimmigrant investor visa is restricted to nationals of certain treaty countries. In contrast, the EB-5 visa is an immigrant visa, open to all nationalities, granting a qualifying applicant permanent resident status, commonly known as a Green Card.
Permanent resident status has many benefits of which investors would want to take advantage of. A Green Card holder can petition for permanent resident status for his spouse and children under the age of 21. It removes employment restrictions, allowing the investor to work in any field he desires, as well as making him or her eligible for social security upon retirement. It allows foreign national homeowners to apply for homestead exemption and realize significant tax savings. Essentially, becoming a permanent resident affords the Green Card holder all the rights and benefits of American citizenship except voting rights. If the investor desires, permanent residents may apply for naturalization, or citizenship, after five years.
The purpose of the EB-5 program is to stimulate the U.S. economy through job creation and capital investment by offering immigrant investors the benefits of permanent residency in the United States.
The EB-5 visa an excellent immigration solution for those who have the financial resources to qualify and can manage high risk investments. It does not require an employment offer from a U.S. employer as other employment-based immigration categories do, nor does it require a labor certification.
Those who qualify for EB-5 status do not typically have to wait long for a visa to become available as there is currently no visa quota backlog for the EB-5 investor category. This is likely to change in 2015, due to increased demand.
EB-5 Immigrant Investor
Wealthy investors and their immediate family can apply for permanent resident status once their petition has been approved and they meet the following requirements:
1. Who establish a new commercial enterprise by:
- establishing a new business, or
- purchasing an existing business and simultaneously or subsequently restructuring or reorganizing the business such that a new commercial enterprise results, and
2. Who have invested or who are actively in the process of investing in a new commercial enterprise:
- A minimum investment of $1,000,000, or
- if investment is made in “targeted employment areas,” the limit is reduced to $500,000. Such qualifying areas must have experienced unemployment rate of at least 150% of the national average; and
3. Whose engagement in a new commercial enterprise will benefit the United States economy and:
- Create or preserve at least 10 full-time jobs for qualifying U.S. workers within two years (or under certain circumstances, within a reasonable time after the two-year period) of the immigrant investor’s admission to the United States as a Conditional Permanent Resident; or
- maintain the number of existing employees at no less than the pre-investment level for a period of at least two years, where the capital investment is being made in a “troubled business,” which is a business that has been in existence for at least two years and has incurred a net loss during the 12- or 24-month period prior to the priority date on the immigrant investor’s Form I-526. The loss for this period must be at least 20 percent of the troubled business’ net worth prior to the loss.
Source of Investment Funds
The USCIS is very strict about reviewing the legitimacy of funds used for investment. Assets acquired directly or indirectly by unlawful means such as criminal activities are not acceptable forms of capital.
The EB-5 program has no specific requirement for the type of invested enterprise, any for-profit activity formed for the ongoing conduct of business including, but not limited to, is acceptable:
- A sole proprietorship
- Partnership (whether limited or general)
- Holding company
- Joint venture
- Business trust or other entity, which may be publicly or privately owned
The USCIS has no age requirements for EB-5 immigrant investors. Age restrictions may be dictated by the state where the enterprise will be located. Since ability to enter into binding contracts is controlled by state law, some states require people to be of a certain age to enter into certain contracts. In general, many EB-5 Regional Center projects welcome investors of all ages.