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Requirements for EB-5 Investors

Requirements for EB-5 Investors

Thousands of foreign nationals have obtained permanent resident status and relocated to the United States through the EB-5 Immigrant Investor Program. Even though many other countries offer visa-by-investment programs, the EB-5 program is by far the most practical and efficient. Moreover, the minimum EB-5 investment amounts are $500,000 for targeted employment area (TEA) projects and $1,000,000 for non-TEA projects. These amounts are significantly lower than those required by other investor visa programs.

Once an EB-5 investor’s I-526 petition is approved by United States Citizenship and Immigration Services (USCIS), they are granted conditional permanent resident status for two years. During this period, the investor can live, work, and study anywhere in the United States. To qualify for permanent resident status, the investor must file Form I-829, Petition by Investor to Remove Conditions on Permanent Resident Status, within the final 90 days of the conditional residence period.

Even though obtaining an EB-5 visa may seem like a straightforward process, EB-5 investors must comply with numerous USCIS regulations. This article outlines some of the basic requirements that EB-5 investors must satisfy.

Employment Creation

Perhaps the most important requisite for EB-5 investors is that they create or preserve at least 10 jobs. One of the EB-5 program’s main objectives is to reduce unemployment, so investors should make sure that they will create jobs for qualifying U.S. workers. Direct EB-5 projects are only allowed to count jobs that appear on the new commercial enterprise’s (NCE’s) payroll. In contrast, regional center investors can also count induced and indirect jobs. Induced and indirect employment is a result of the expenditures made by the EB-5 project and its employees in the community. This spending benefits the local economy and thus indirectly creates jobs.

Additionally, each hired worker must have legal authorization for employment in the United States, and the created positions must be full-time (at least 35-hour) jobs.

Documenting Sources of Funds

USCIS requires foreign nationals to provide exhaustive evidence that their EB-5 investment capital was sourced lawfully. Form I-526 should trace the invested funds back to their source and prove its legality. Investors are allowed to fund their investments using a wide variety of sources, including stock proceeds, real estate sales, gifted capital, loans, and even cryptocurrency sales.

The documentation needed to prove the origin of the invested funds will vary for each investor and source of capital. An investor using gifted funds, for instance, would have to submit a copy of the gift agreement and bank statements showing that the gift was deposited. In contrast, an EB-5 investment made using salary payments would require the investor to provide their employment contract, an income certificate, and bank statements reflecting each payment.

The At-Risk Status of Funds

All EB5 investment capital must remain at risk for the duration of the investment. This means that that the invested funds must be subject to normal losses or gains depending on the success of the EB-5 business. For example, an EB-5 investor would violate the at-risk requirement if they received a guarantee that the invested funds would be returned in the event of market failure.

Navigating USCIS’s numerous guidelines can be challenging, but EB-5 investors must take care to comply with all these regulations. Therefore, retaining an experienced immigration attorney is a must for foreign nationals interested in making an EB-5 investment.