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3. EB-5 Investment Visas

EB-5 Program

   The EB-5 Program is also known as the Immigrant Investor Program; Congress created this program in 1990 to stimulate the US economy via job creation and capital investment by immigrant investors. Through this program, immigrant investors create new enterprises or invest in troubled businesses. Annually, there are 10,000 EB-5 Program Visas available. Three thousand of these at a minimum are set aside for investors in Regional Centers; these centers are designated by the US Citizen and Immigration Services (USCIS).

EB-5 Program Requirements

   The EB-5 Basic Program requires that the immigrant investor make a capital investment of $500,000 or $1 million. If in a Targeted Employment Area (TEA), a rural area or a place of unemployment of at least 150 percent of the national average where the investment required is the lower of the 2 above numbers. In a Targeted Employment Area (TEA), a rural area or a place of unemployment of at least 150 percent of the national average, then the investment required is the lower of the 2 numbers?

   The Regional Center Pilot Program requires the investor to submit a proposal to USCIS for approval. The proposal must show how the Regional Center will focus on a geographical region of the US and promote economic growth there; must verify in detail how jobs will be created either directly or indirectly through capital investments; must show the amount and source of the capital committed to the regional center; and must show how the regional center will positively impact the economy of the region or nation.

   New commercial enterprises created under the EB-5 Program must create or preserve 10 full time direct or indirect jobs. These jobs must go to qualified US workers within the 2 year conditional Green Card period. Direct jobs are those in the commercial enterprise within the enterprise that the EB-5 Visa-holding investor has invested his or her capital. Indirect jobs, on the other hand, are those created as a result of the initial capital investment.

EB-5 Visa Application Process

   The procedure for obtaining an EB-5 Investor Green Card is relatively straightforward, but consultation with an immigrant attorney will ensure that the application process is done correctly the first time. The non-immigrant visa applicant submits an I-526 application, ideally prepared by an experienced immigration attorney, accompanied by 5 years of tax returns to substantiate the source of investment funds. The funds can be the EB-5 visa investor’s own money or in the form of a loan not secured by the EB-5 investment or a gift, which would allow a parent to gift the funds to a son or daughter. Gift taxes, if required in the investor’s home country, must be paid. The investor must also present evidence, through bank transfers and other financial documentation, that the invested capital came directly from the investor to the EB-5 enterprise.

   After the investment visa applicant completes their due diligence in the EB-5 project, the investment is made and an investor I-526 petition is filed with USCIS, requiring USCIS to certify that the applicant and the investment are eligible for EB-5 visa status. The approval of the I-526 petition takes from 4-6 months for Regional Center cases and usually longer for regular program cases. Once USCIS approves the investor’s Green Card, it is conditional for a period of 30 months (two and a half years). Conditional Green Card status confers the same rights as the permanent unconditional Green Card.

   Between 21 and 24 months after the conditional Green Card has been approved, the EB-5 investor must reconfirm that the investment has been made or is still in place and that the employment requirement has been fulfilled or maintained. An application to remove the conditional Green Card status is filed with USCIS.

   Once the condition has been removed, an unconditional Green Card is granted for permanent resident status in the United States. From the time of application for the conditional Green Card until approval of the Removal of Conditions, is approximately four years. Thereafter, in approved Regional Center programs, depending on the terms of the agreement, the investment may be sold, and the investor will maintain the permanent Green Card. U.S. Citizenship is possible approximately two and a half years later ( a total of five years after approval of the conditional Green Card), upon satisfaction of U.S. residence.

   Freedom to live anywhere in the United States, a passive form of investment with no required direct management responsibilities (other than a limited partner policy making role), and priority standing within the immigration process resulting in an accelerated path to Green Card procurement are all important factors making the EB-5 Immigrant Investor Visa category via a Regional Center program, an ideal investment vehicle for the inactive investor or retiree.

EB-5 Program Capital Investment Requirements

   The capital investment requirements for the EB-5 Visa holder include cash, inventory, equipment, and other assets owned by the immigrant investor. All capital is valued in fair-market US dollars. Generally, the minimum qualifying investment is $1 million and can be borrowed or gifted funds. For a targeted employment area (an area of high unemployment or a rural area), $500,000 US dollars is the minimum qualifying investment.

   Under the EB-5 Program, immigrant investor visa holders are admitted to the US as a Conditional Permanent Resident for 2 years and then must apply for a permanent visa (green card) by showing qualifying job creation and investment. Williams & Williams Law Firm had a great success records of obtaining green cards through EB-5 program.

EB-5 Visa Benefits

   An immigration attorney can explain in more detail the following ways in which the EB-5 visa Regional Centers benefit potential investment visa applicants, especially retirees or inactive investors:

* USCIS approval offers very high security to a potential non-immigrant visa investor
* “Indirect employment creation” that aids an EB-5 visa investor in meeting the job-creation requirement
* In a limited-partnership role, the investment of the EB-5 visa holder is passive in nature.

   In the current economic climate, non-immigrant visas present foreign investors with many options. The ability of a Regional Center and the specific projects undertaken under the Regional Center umbrella to receive USCIS approval demonstrates that the United States government has vetted the business group and the group has committed their financial and business resources to prepare the materials required for submission of the complex EB-5 visa application. Further, upon Regional Center designation, the group oversees the acquisition of investment funds, the development and successful operation of the project and the reporting requirements mandated by the USCIS so the investment visa holder achieves his or her their immigration goals as well as the return on, and of, the their investment.

   An investment through the Regional Center program alleviates the burdensome job-creation requirement. The Regional Center program removes the 10 direct-employee requirement of the traditional EB-5 visa program, and substitutes a less-restrictive “indirect employment creation.” The visa investor satisfies the requirement by presenting evidence that the project will create 10 new jobs within the Regional Center economy as a result of the proposed project. This is evidenced by a USCIS approved econometric analysis performed by WJ on behalf of the client.

   The role of a limited partner satisfies the management requirement imposed by federal regulations for non-immigrant visa investors, while simultaneously permitting the EB-5 visa holder to make a passive investment. As a limited partner, the EB-5 investor has limited policy-making involvement, yet no business making or day-to-day management authority. Thus, for the vast majority of immigrant investors not interested in day-to-day or active management of a business, Regional Center programs offer the most attractive option. This form of business structure also protects the investor, as the EB-5 investor is only liable to the extent of the amount of their investment.

   Another advantage of the Regional Center program is the investment visa holder is not required to live in the place of investment. Rather, he or she can live anywhere in the United States. For example, the investor may use the EB-5 visa to invest in a Regional Center in the State of California, but choose to live in Florida.

   Under mandate by Congress, Regional Center EB-5 petitions are given priority often resulting in a quicker path to approval. A Regional Center must be pre-approved to be eligible for an immigrant investor to apply for an EB-5 Green Card.

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