Businesses explore various methods to raise capital to help their business. In particular, in real estate, many large developers will resort to applying for loans from financial institutions for a new project. However, in some instances, these developers look to foreign investors to help fund these new projects.
In this case, created by Congress in 1990 and administered by the U.S. Citizenship and Immigration Services, the EB-5 Visa allows foreigners to invest in a new commercial enterprise in the U.S. that also stimulates the U.S. economy through job creation, and in return they have the ability to receive a green card for them and their family members. Since applying for the EB-5 Visa is a legal procedure under the existing laws by the USCIS, you need to consider a couple of things to help you acquire the immigrant investor visa.
The following are 5 tips to help you better understand the EB-5 visa.
1. Understand the requisite investment amount
EB-5 visa seekers are required to invest a minimum of $500,000 U.S. dollars and up to $1,000,000 U.S. dollars into a U.S. based new commercial enterprise. The investment may take the form of secured indebtedness, inventory, cash, equipment, tangible property or its cash equivalent valued on the U.S. dollar real fair-market value.
Requisite capital may drop from $1 million to half the amount if the project is located in a TEA area, or an area with high unemployment.
2. Understand business entities that qualify for capital injection
There exist several kinds of business entities where an EB-5 candidate can invest. Applicants may invest directly in a regional center or new firms. New enterprises are legal profit-making entities that take many forms of business structures.
Examples of such business include; business trusts, sole proprietorships, general or limited partnerships, corporations or other publicly or privately owned business structures.
Existing enterprises may meet requirements if the capital injection leads to a forty-percent growth in the number of personnel or net-worth, or if a restructure gives rise to a new venture.
3. Understand the job creation stipulations
The USCIS regulations require that EB-5 ventures culminate in the creation of ten full-time jobs eligible for people qualified to work in the United States. For a new commercial enterprise that you invest in that is not with a regional center, the full-time positions must be created directly by the new commercial enterprise to be counted. This means that the new commercial enterprise must itself be the employer of the qualifying employees. For a new commercial enterprise located within a regional center, the full-time positions can be created either directly or indirectly by the new commercial enterprise. This is one very big upside to investing with a regional center.
4. EB-5 regulations state that funds must come from a legitimate source
The EB-5 seeker must ascertain the capital he intends to invest came from a lawful source. Sale of property, business records or tax returns may prove capital was acquired lawfully. A loan or gift is a legit source of money as long as the loaned or gifted money was legal as well.
5. Understand the role of an EB-5 investor into a business
For a new commercial enterprise that you invest in that is not with a regional center, An investor must be actively involved in the management of the company and can’t play a passive role. However, he or she can be a limited partner, corporate officer, or on the board of directors.
For a new commercial enterprise located within a regional center, the investor does not have to be involved in the business at all.
For more information on the EB-5 Visa program and EB-5 regional centers visit: https://visaeb-5.com/
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