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The Impact of the Pandemic on Citizenship Planning

The Impact of the Pandemic on Citizenship Planning

As custodians of public health during the COVID-19 crisis, governmental bodies all around the globe have found necessity in the temporary limitation of their citizens’ personal freedoms. This is most visible through adjustments to social benefits, the application of travel restrictions, and mandates on who can work and where they may do so, as well as by defining what constitutes essential needs.

A collateral consequence of navigating the global pandemic is that these limitations have forced prospective immigrant investors to re-evaluate whether possessing global mobility options remains important at this time. These kinds of decisions among foreign nationals with the resources to invest can have a rippling effect upon an already shaky global economy.

The same holds true for one of the most popular U.S. residency-by-investment initiatives, the EB-5 Immigrant Investor Program. A program implemented in 1990, it has provided hundreds of thousands of immigrant investors with a path toward lawful permanent residency in the United States. Simultaneously, it has garnered billions in foreign investment capital, stimulating job growth and the economy overall in the United States. Since the financial fallout in 2008, the EB-5 program has only seen exponential gains in popularity.

The U.S. Remains a Top Choice for Prospective Foreign Investors

The United States leads the world in COVID-19 infection rates, its last four years of leadership have been less than friendly toward immigrants around the globe, and racial and political tensions seem to have reached a fever pitch. Despite all of this, the nation remains a top contender for foreign investors, and here’s why.

Better Education and Healthcare Options

Access to world-class education and health care are cited as leading reasons foreign nationals keep the United States on their immigration wish list. The United States is the home base of many of the top universities in the world. Real estate investment is better than anywhere else, according to EB5 Affiliate Network’s survey of 300 wealthy Chinese investors, and Newsweek’s 2020 report shows three of the world’s best hospitals on U.S. soil.

Relative Political and Economic Stability

Despite what seems to its own citizens to be real political strife and economic downturn, compared to the rest of the world, the United States is still a beacon to immigrants from all over. It remains the land of the free, and through the EB-5 program, eligible EB5 investment participants can work and live freely in the country without additional requirements. Furthermore, more often than nearly anywhere else, diligent study and hard work are still rewarded.

A Closer Look at Turmoil Outside U.S. Borders

A number of political circumstances outside U.S. borders are increasingly becoming drivers of EB-5 investment. Latin America, for instance, has always dealt with cyclical politics and economics. But those ups and downs have been exacerbated by COVID-19, and individuals on the high end of the economic gap have sought stability through residency-by-investment programs. Economic and political shifts in Mexico, Chile, and Argentina in particular have left wealthy citizens under critical pressure.

New tax proposals aim to increase the tax burden on the wealthy to help cover costs for oversized and inefficient governments. New policies appear to abandon private capitalism in favor of more socialist-leaning legislation. As a result, high-net-worth individuals are transferring their wealth outside of their home countries in an effort to protect the value of their estates. Moving away from their countries of origin is a strategy to be free from their own governments’ burdening requests.

These foreign nationals who prefer to seek shelter for themselves and their eligible family members in the United States are setting their sights on the E-2 and EB-5 programs. The industry can reasonably expect considerable growth over the next few years from these applicants.

A Win-Win Investment Model

The EB-5 Immigrant Investor Program offers more than just meaningful incentives for foreign nationals—it also provides Americans with crucially important benefits. The jobs and economic wellness attained through the infusion of EB5 investment participants’ capital are key to this symbiotic investment model. This win-win initiative is a viable solution to quelling at least some of the unemployment burden brought on by the pandemic, and its viability has been proven time and time again over the course of its implementation.

The other key variable in this formula is the folks who support EB-5 investors. To maintain the well-earned momentum of this residency-for-investment program, the support systems in place for citizenship planning must remain strong.

The Journey to Residency-by-EB-5 Investment Is Complex

Tying up the normal loose ends of life and packing can end in logistical crises for anyone planning an international move. Being strategic in one’s financial, investment, and other estate planning endeavors adds whole new layers of challenges. Savvy foreign investors not only plan for the short-term but also set themselves up for the long game. For all of these reasons, it is crucial for EB-5 investors to partner with the right support team when they begin their EB-5 investment.

For international families and entrepreneurs seeking out an EB-5 investment team, there are a range of logistical solutions a network of EB-5 professionals should provide. Here are a few of them:

  • Accounting and administration
  • Corporate formation
  • Local tax and regulatory compliance
  • Preimmigration tax and legal guidance
  • Trust information and establishment

One of the most complex and important aspects of planning a move to the United States is the tax implications it presents. The United States maintains a worldwide income tax model, which means each taxpayer is required to provide information on all U.S. and foreign income on every annual return. Global reporting is necessary for all foreign accounts, assets, and investments, as well. Every business owner and investor understands the importance of delegation and the importance of using trusted advisors and team members.