EB5 Visa Comprehensive Guide : All You Need to Know

10. Can Gifted Funds Be Used for an EB-5 Investment?

Yes, you can use funds gifted to you by another person for your EB-5 investment. However, it is essential that the gifted funds are fully under your control before being invested in the EB-5 business. The individual gifting the funds cannot directly invest on your behalf.

Additionally, you must prove that the person who gifted you the funds obtained them lawfully. This requirement also applies if your EB-5 investment capital comes from an inheritance.

11. Do EB-5 Investments Have to Be in Cash?

No, your EB-5 investment does not necessarily have to be in cash. The regulations allow for other forms of “capital” to be invested into the business.

Examples of eligible capital include:

• Cash
• Equipment
• Inventory
• Cash equivalents
• Tangible property
• Proceeds from a loan

If the investment capital is sourced from a loan, it may be either secured or unsecured. However, if secured, it must be backed by your personal assets, and you must be primarily responsible for the repayment.

It’s important to note that non-cash investments, such as inventory, will be valued at their fair market value.

12. What Does It Mean for an EB-5 Investment to Be “At Risk”?

To comply with EB-5 requirements, your investment must remain “at risk” for the entire sustainment period.

This means that the funds are subject to potential gain or loss depending on the enterprise’s success. Simply holding funds in a business’s operating account without using them for business activities does not satisfy this requirement.

Key points to remember about the “at risk” rule:

• Your investment must be exposed to potential financial gains or losses.
• There cannot be any guarantee of a return on your investment.
• You must not have a prearranged right to redeem any part of your investment.
• Your capital should resemble an actual investment, not a loan to the enterprise.

The intent is for your funds to actively contribute to the success of the business.

13. Steps to Obtain an EB-5 Visa

Here’s a simplified overview of the EB-5 visa application process:

Step 1 – Hire an Experienced Immigration Attorney

Begin by consulting an immigration attorney with a strong track record in EB-5 cases. Your attorney will determine if the EB-5 visa aligns with your immigration goals and ensure compliance throughout the process.

They will also analyze your chosen investment and prepare the necessary documents to demonstrate your eligibility.

Step 2 – Choose an Investment

Select an EB-5 project that aligns with your preferences and goals. Conduct thorough due diligence to ensure the investment meets immigration requirements.

If needed, seek advice from a qualified Registered Investment Advisor or Broker/Dealer with EB-5 program expertise. Your attorney will assist in confirming that the project adheres to immigration regulations.

Step 3 – Make the Investment

Invest your capital into the selected commercial enterprise.

When filing Form I-526, you must prove that the investment has already been made or is actively in progress. Funds placed in an escrow account can be considered, provided their release is contingent on Form I-526 approval.

Intent to invest at a future date is insufficient; the funds must be committed.

Step 4 – File Form I-526

Your attorney will file Form I-526, the initial EB-5 petition, along with the supporting documents.

Once approved, you become eligible to apply for conditional permanent residency, which is a two-year green card. During this period, you must meet all EB-5 requirements, including creating 10 full-time jobs for U.S. workers.

Step 5 – Adjust Status or Process the Visa

You can apply for your conditional green card either by adjusting your status within the U.S. (via Form I-485) or through consular processing abroad (using Form DS-260).

Step 6 – File Form I-829

After 21 months as a conditional permanent resident, you may file Form I-829 to remove the conditions from your green card.

This form demonstrates that you met all EB-5 requirements, including maintaining the investment and creating 10 full-time jobs.

Step 7 – Naturalization (Optional)

After holding permanent residency for at least five years, you may be eligible to apply for U.S. citizenship through naturalization.

14. How Long Does the EB-5 Process Take?

Form I-526 Processing

Currently, USCIS processing for Form I-526 takes about 18 months on average. This timeline is expected to improve over time.

Adjustment of Status or Visa Processing

• Adjustment of Status: Typically takes 10–14 months.
• Consular Processing: Usually takes 8–12 months.

Conditional Permanent Residency

As a conditional green card holder, you will have a two-year residency period during which you can live and work in the U.S.

Form I-829 Processing

Processing of Form I-829 currently takes about 2.5 years, though this is expected to accelerate in the future.

Permanent Residency (Green Card)

Upon approval of Form I-829, you become an unconditional lawful permanent resident.

Naturalization (Optional)

After five years of permanent residency, you may apply for U.S. citizenship. The five-year period begins when you first obtain conditional permanent residency.

15. Will the EB-5 Program Change in the Future, and What Changes Could Occur?

Over the years, the EB-5 program has faced significant criticism for various reasons. Some of the common complaints include:

• Ethical concerns: Critics argue it is unfair for wealthy individuals to gain U.S. residency through financial investments.
• Investment thresholds: Many believe the minimum investment amount is too low and should be increased.
• Targeted Employment Areas (TEAs): The rules for designating TEAs have been deemed too lenient, with some investments placed in affluent locations like Manhattan or Beverly Hills.
• Regional center oversight: Concerns about fraud and misuse have prompted calls for tighter regulations and scrutiny of regional centers.

To address these concerns, the EB-5 Reform and Integrity Act of 2022 was enacted, implementing reforms to tackle these issues. This legislation is anticipated to provide long-term stability and integrity to the EB-5 program.

16. What Are the Job Creation Requirements?

For every EB-5 investment, 10 full-time jobs must be created.

• If a regional center project has 4 EB-5 investors, a total of 40 jobs must be generated.
• These positions must be full-time (at least 35 hours per week) and held by qualifying employees, such as:
  • U.S. citizens
  • Lawful permanent residents
  • Other immigrants authorized to work in the U.S.

Excluded from this category are:

• The EB-5 investor, their spouse, and children.
• Nonimmigrants or individuals without work authorization in the U.S.

The jobs created must:

• Last for at least two years.
• Not be seasonal, temporary, or intermittent.

Job sharing arrangements, where two employees share a single full-time role, are allowed, but two part-time roles cannot be combined to count as one full-time job.

17. Do Existing Jobs Count Toward the EB-5 Job Creation Requirement?

No, the EB-5 program requires the creation of 10 new full-time jobs.

• If you purchase an existing business, the current jobs will not count toward your requirement.
• You must create 10 additional jobs beyond those that already exist.

Exception for troubled businesses:

• A “troubled business” is defined as one operating for at least two years and incurring a net loss of 20% or more in its net worth within the 12-24 months before filing Form I-526.
• In such cases, the jobs you save may count toward the 10-job requirement, provided:
  • The current jobs are preserved for at least two years.
  • If fewer than 10 employees exist, additional jobs must be created to meet the minimum.

Example:
If a troubled business employs 5 full-time workers, you must maintain those positions and create 5 more to satisfy the EB-5 criteria.

18. What Does “Engaging in the Management of the Enterprise” Mean?

To qualify for an EB-5 visa, you must actively participate in the management of the new commercial enterprise. This can be achieved by:

• Formulating policies for the business.
• Overseeing daily operations.

Passive investment does not meet this requirement. For regional center investments, acting as a limited partner often suffices if you possess rights typically granted to limited partners, such as voting rights.

When filing your EB-5 petition, you may also submit:

• A statement outlining your job title.
• A description of your management duties.

19. Can the EB-5 Visa Lead to U.S. Citizenship?

While the EB-5 visa does not directly grant citizenship, it provides a pathway to eventually become a U.S. citizen.

• The EB-5 visa grants you lawful permanent residency (a green card) after completing the process.
• You first receive a conditional green card, which can later be converted to a permanent one.
• After being a permanent resident for 5 years, you may apply for citizenship through naturalization.

Naturalization requirements include:

• Residing in the U.S. for at least 2.5 years during the 5-year period.
• Maintaining continuous residence and good moral character.
• Passing a U.S. civics and English language test.

20. What Documents Are Needed for an EB-5 Application?

A well-prepared EB-5 petition requires detailed documentation. The required documents generally fall into three categories:

1. Investor-related documents
2. Business-related documents
3. Source and path of funds

It’s essential to have an experienced immigration attorney help organize these materials. Below is an outline of typical documents:

Investor-Related Documents

• Identity page of the investor’s passport.
• Foreign birth certificate.
• Resume.
• Diplomas, degrees, awards, or certifications.
• Marriage certificate (if applicable).
• Social Security card (if applicable).

Business-Related Documents

• Comprehensive business plan.
• W-2 and I-9 forms for current employees.
• Payroll records.
• Job descriptions for all positions.
• Business entity documents, such as:
  • Articles of incorporation (for corporations).
  • Articles of organization (for LLCs).
  • Operating agreements.
  • Partnership agreements.

Source and Path of Funds

The specific documents depend on how your investment funds were obtained:

• Sale of property:

  • Purchase and sale agreements.
  • Certified checks or wire transfers.

• Business ownership:

  • Balance sheets and tax returns.
  • Statements detailing the investor’s role and income.

• Loans:

  • Loan agreements.
  • Documentation of disbursed funds.
  • Evidence of lender’s lawful source of funds (if the lender is an individual).

• Gifts:

  • Letter from the gift-giver.
  • Bank statements showing gift receipt.
  • Documents proving the gift-giver’s lawful source of funds.

Important Note: All documents must be translated into English if they are in another language.

Having a properly assembled application increases your chances of success and ensures compliance with USCIS requirements.

21. What is the Role of My Immigration Lawyer in the EB-5 Visa Process?

What Your Immigration Lawyer’s Role is Not:

• Your immigration lawyer is not a financial or investment advisor.
• They should not advise you on which project to invest in, except to determine whether the investment meets the immigration requirements for the EB-5 visa.

What Your Immigration Lawyer’s Role Is:

• Think of your immigration lawyer as the coordinator for the entire EB-5 process.
• They should evaluate whether the EB-5 visa aligns with your immigration goals and circumstances.
• Once determined that EB-5 is the right path, they will guide you through every step of the process.
• Your lawyer will assess whether your chosen investment meets EB-5 visa requirements.
• They will analyze the source of your funds and determine the documentation needed for your application.
• Your attorney will compile and submit your EB-5 application to USCIS.
• If USCIS issues a Request for Evidence (RFE) for your I-526 or I-829 petition, your lawyer will prepare and submit a response with the necessary information.
• After your I-526 petition is approved, they will assist with status adjustment or immigrant visa application.

22. How Do I Find a Business to Invest in for My EB-5 Visa?

• Conduct thorough due diligence on the business or regional center project before investing, just as you would for any investment.
• Supplement your research with guidance from professionals such as Registered Investment Advisors or Broker/Dealers.
• These professionals, regulated by the Financial Industry Regulatory Authority (FINRA), can assist in selecting an appropriate investment.
  • Registered Investment Advisors: Typically provide advice for a fee.
  • Broker/Dealers: Usually earn a finder’s fee from the businesses or regional centers they recommend.
• Use FINRA’s BrokerCheck tool (brokercheck.finra.org) to verify the credentials, licensing, and experience of your advisor.

23. Who Qualifies for an EB-5 Visa?

• The EB-5 visa is available to individuals from any country, unlike the E-2 visa, which requires citizenship in a treaty nation.
• If you meet the investment and program requirements, and are not otherwise ineligible, you can apply for the EB-5 visa.

24. What is the “Visa Backlog,” and Who Does it Affect?

• Only 10,000 EB-5 visas are issued annually.
• The Immigration and Nationality Act (INA) places a cap on visas issued to nationals of a single country.
• A backlog occurs when the number of approved I-526 petitions for a country exceeds its visa allotment.
• Chinese investors, for instance, face significant delays due to high demand, resulting in long waits after I-526 approval.

25. When Do My Investment Funds Need to Be Committed?

• At the time of I-526 filing, you must demonstrate that your funds have been invested or are actively in the process of being invested in the enterprise.
• A mere intention to invest is insufficient.
• Funds can be placed in an escrow account before filing, with their release contingent on I-526 approval. This arrangement must be carefully handled by an experienced immigration lawyer.

26. Can My Family Members Come to the U.S. on My EB-5 Visa?

• Yes, your spouse and unmarried children under 21 are eligible for EB-5 visas and can eventually become lawful permanent residents.

27. What Does it Mean for My Child to “Age-Out”?

• Children under 21 can obtain green cards with you as dependents of your EB-5 visa.
• Aging out occurs when your child turns 21 before obtaining their visa.
• Their age is calculated as their age when a visa becomes available, minus the time taken to process your I-526 petition.
• This calculation can be complex, especially for applicants from countries with visa backlogs. Consult an attorney if you need assistance.

28. How Soon Do I Need to Enter the U.S. Once My Visa is Approved?

• Your EB-5 visa is typically valid for six months. You must enter the U.S. within this period.
• Upon entry, you become a conditional lawful permanent resident and will receive your conditional green card.

29. Do I Have to Live in the U.S. After Receiving My Green Card?

• As a lawful permanent resident, you must intend to reside in the U.S. permanently. However, you can travel outside the U.S.
• Extended absences may jeopardize your residency status. To mitigate this risk, consider applying for a reentry permit, valid for two years, which signals your intent to maintain U.S. residency.

30. Can I Use My Existing U.S. Business for My EB-5 Investment?

• Yes, your existing business can qualify if it meets EB-5 criteria:
  • It must qualify as a new commercial enterprise.
  • The required investment amount must be met ($1,050,000 or $800,000 for targeted employment areas).
  • Funds already invested may count toward the total, provided they were lawfully obtained.
  • You must demonstrate that the investment creates 10 full-time jobs.
  • The funds must be “at risk” as required by the EB-5 program.

31. Can I Transition from an E-2 Visa to an EB-5 Visa?

• Yes, you can adjust your status from an E-2 visa to an EB-5 visa while in the U.S.
• If using your E-2 business for the EB-5 investment, potential advantages include:
  • Previously invested funds may count toward the EB-5 requirement.
  • Jobs created under the E-2 visa may count toward the 10 full-time jobs needed for EB-5 compliance.