EB-5 investments are a great way to secure a green card in the United States. However, it is essential to understand the requirements and choose the right project for you.
Generally, there are two options for EB-5 investors: investing in a new commercial enterprise or pooling with other EB-5 investors and making an investment through a USCIS-approved regional center. Both methods are viable choices and will result in a green card.
Project Requirements
The EB-5 program, like EB-5 green card process, has strict requirements for projects eligible for investor capital. These requirements include using multiple guarantees and protections to reduce immigration risk, loan terms, and repayment options that meet USCIS requirements for keeping EB-5 investment capital at risk.
Projects must also be in a Targeted Employment Area (TEA) and create at least ten new full-time jobs for American citizens throughout the two-year EB-5 green card process. This can be achieved through bridge financing, which allows projects to generate a pool of employment before EB-5 investors make their investments.
TEA designation is critical because it makes qualifying for the EB-5 investment visa more attractive. In addition, TEAs are often located in rural areas or high-unemployment areas, which are more likely to have job sectors that the EB-5 program can target.
While TEAs do not require projects to be located in these areas, many project sponsors will seek to secure these locations before investing any EB-5 investment capital because these locations offer the best opportunity for long-term economic growth and job creation.
The number of jobs a project creates will depend on how the business plan is structured and how the construction spending matches the budget. This is especially important for regional center projects that have a multi-entity structure.
Location Requirements
One of the essential requirements for an EB-5 investor is that they invest in a business that is located in a target employment area. This can either be a high unemployment or a rural area designated by the state.
Alternatively, an investor can invest in a regional center. These are business entities regulated by USCIS that pool capital from many investors and use it to develop projects in targeted areas.
There are many advantages to investing in an EB-5 project through a regional center. For example, they can help connect you with a developer who needs the investment to begin building a project.
Another advantage of investing through a regional center is that you can often receive a lower investment amount than if you made a direct investment. This is because the regional center can take credit for indirect jobs, such as those created by a supply chain.
You can also count existing jobs when investing through a regional center. For instance, if you invest in a troubled business, you can claim that the job creation requirement was met by saving or maintaining the number of jobs in the industry before the EB-5 project was started.
Whether you make a direct investment or invest through a regional center, you must show that the new commercial enterprise creates ten full-time jobs for U.S. citizens. This can be not easy, so getting professional advice before making an EB-5 investment is a good idea.
Job Creation Requirements
The EB-5 program requires that a foreign investor invests in a new commercial enterprise or regional center that will create or preserve at least ten jobs in the United States. Once the requirements are satisfied, the immigrant investor and their dependent family members can obtain permanent residence in the United States.
To meet the job creation requirement, an investment must generate direct jobs filled by qualified employees. This includes citizens, permanent residents, refugees, and asylees. Additionally, a foreign investor must hire an employee who can work in the United States indefinitely.
Indirect employment is another way to satisfy the job creation requirement. This can be accomplished by hiring a qualified employee to assist in the operation of the commercial enterprise and submitting payroll or W-2 forms.
In addition, some EB-5 investors may choose to invest through a regional center, allowing indirect jobs to count toward the job creation requirement. These businesses have a high level of experience in the EB-5 program and a reputation for providing good economic reports highlighting indirect jobs created by EB-5 projects.
Financial Requirements
For EB-5 investors to qualify for a green card, they must invest in a new commercial enterprise that creates at least ten full-time jobs. Alternatively, they can invest in a Regional Center project that pools funds from multiple investors.
Regardless of which route an investor takes, they must be able to prove that the investment money was obtained legally and came from legitimate sources. This is especially important in the case of direct investments because the investor must play an active role in the business.
To demonstrate this, they must provide documentation for all sources of the money, including personal income tax returns for the previous five years. Additionally, they must submit evidence of all loans taken for the EB-5 investment.
In some cases, it is possible to use a personal loan to meet the financial requirements for an EB-5 investment. However, this is a risky endeavor and can be challenging to navigate.
An EB-5 investor should seek the assistance of an immigration attorney or EB-5 professional to determine the best source of funds for their I-526 petition. The most straightforward source of funds is usually a loan from a bank or other financial institution.
In addition to proving that the investment capital comes from legal sources, EB-5 visa applicants must prove that the administrative fees they pay to a project are lawful. This is not always easy, so providing USCIS with all the necessary documentation is essential.