The EB-5 program was created to benefit the U.S. economy by providing an incentive for foreign capital investment in commercial enterprises that create or preserve U.S. jobs.
The immigrant investor category requires three main elements:
- An investment of capital
- Engagement in a new commercial enterprise; and
- Job creation.
Investment of Capital
You are required to put your capital at risk to count as an investment. For instance: loans, bonds, notes, and other forms of debt don’t count as investment. Furthermore, the broad definition of capital takes into account many different ways you can contribute financial value to a business, such as:
- Cash
- All real, personal, or mixed tangible assets
- Owned and controlled by you, or
- Held in trust for your benefit, with unrestricted access
- A loan or promissory note, as long as
- You are the primary lender
- It is fully backed by assets you own
- The assets do not belong to the new company you are investing in
The minimum investment amount is $1,050,000, or $800,000 if you’re investing in a rural area or with low employment. If you filed Form I-526 before March 15, 2022 the minimum investment amount is $1,000,000 and $500,000 respectively.
Business Activity
An immigrant investor must provide evidence of the actual undertaking of business activity.
- Merely establishing and capitalizing a new commercial enterprise and signing a commercial lease are not sufficient to show that an immigrant investor has placed his or her capital at risk.
- Without some evidence of business activity, no assurance exists that the funds will be used to carry out the business of the commercial enterprise.
The full amount of the investment must be made available to the business(es) most closely responsible for creating the employment upon which the petition is based.
Evidence of Job Creation
The business you’re investing in has to create at least 10 jobs working directly for the company, or indirectly if you invest in a regional center approved by USCIS. Moreover, if you invest in a troubled business, it can be any combination of preserving or creating at least 10 jobs for the U.S.
The evidence to prove job creation may include, but is not limited to the following:
- For direct jobs created as a result of the immigrant investor’s investment, evidence such as:
- Payroll records,
- Relevant tax documents
- Employment Eligibility Verification (I-9) showing employment by the new commercial enterprise or troubled business
- For jobs created indirectly as a result of an investment in the regional center context, reasonable methodologies, including:
- Multiplier tables,
- Feasibility studies,
- Analyses of foreign and domestic markets for the goods or services to be exported, and
Other economically or statistically valid forecasting devices.
The regulatory definition of a troubled business is a business that has:
- Been in existence for at least 2 years;
- Has incurred a net loss for accounting purposes (determined on the basis of generally accepted accounting principles) during the 12-month or 24-month period prior to the priority date on the Immigrant Petition by Alien Investor; and
- Had a loss for the same period at least equal to 20 percent of the troubled business’s net worth prior to the loss.
Removal of Conditions
When you file the petition to remove conditions, you must prove the following:
- The required funds were placed at risk throughout your conditional stay in the United States;
- The required amount of capital was made available to the business or businesses most closely responsible for creating jobs (unless the job creation requirement has already been satisfied);
- This at-risk investment was sustained throughout the period of the petitioner’s conditional permanent residence in the United States; and
You created (or maintained, if applicable),or can be expected to create within a reasonable period of time, the requisite number of jobs.
For further questions, please contact our office and schedule a consultation with the attorney Sarah Mu. We look forward to working with you.