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What Kind of Documents Do You Need for the EB-5 Source-of-Funds Requirement?


Every year, countless investors from around the world start their journey toward U.S. permanent residency status through the EB-5 Immigrant Investor Program. The program, established in 1990, allows foreign nationals to apply for a U.S. green card in exchange for an investment in a new commercial enterprise (NCE), contingent on certain requirements.

EB-5 investors must invest a minimum of $1.8 million in a qualifying EB-5 project to receive an EB-5 visa. If the NCE is located within a targeted employment area (TEA), the minimum investment amount falls to $900,000. Regardless of the amount, all EB-5 investors must prove on their I-526 petition that all their investment capital was obtained lawfully.

EB-5 investors must document the path of their investment capital from acquisition to investment in the qualifying EB-5 project. This is often one of the most difficult and time-consuming aspects of the EB-5 program, and investors are encouraged to seek out immigration counsel to determine the best funds to trace. Some types of funds are easier to trace than others, so investors can save a significant amount of time by consulting an EB-5 lawyer on the source-of-funds requirement.

EB-5 investors can use many types of funds in their investment. Below are some of the most common sources of funds and the documentation investors may need to present for each.

For income from real estate, source-of-funds documentation can include purchase or sales contracts for the property, documents certifying a mortgage, deeds, appraisals, proof of income from renters, and bank account statements.

For income from business ownership, EB-5 investors should provide records of business ownership, appraisals, business registration documents, and accounting and sales records.

For income from investments, applicable documentation includes tax returns, stock certificates, brokerage statements, and retirement account statements.

For loans, EB-5 investors must prove the source of the loan if it is not a bank loan. This may also require documenting the collateral. Bank loans must also be documented, although this can be satisfied easily with documentation from the loaning bank.

For income from employment, EB-5 investors can satisfy the source-of-funds requirement by providing W-2s, earnings statements, bank account statements, employment contracts, and deposit records over the past few years.

For donations—which are common from parents to a child—the EB-5 investor must present a donation letter where the donor states the recipient is under no obligation to return the gift. The donor must also document the legal sources of the funds they gifted to the recipient.

For inheritance, EB-5 investors must present source-of-funds documentation as relevant, including estate or business documentation.

This is not an exhaustive list of the sources of funds EB-5 investors may use. Since each EB-5 investor has a different situation, it’s imperative that they reach out to an experienced EB-5 attorney to assist them in this grueling process, who can offer advice and guidance in choosing and documenting funds.

EB-5 investors must also bear in mind that, while the minimum investment amount is $1.8 million (or $900,000, depending on TEA status), they must be prepared to dish out around $50,000 to $75,000 more for administrative fees. Before diving into an EB-5 investment, investors must makes sure they have enough funds to cover all the supplementary costs.