AN OVERVIEW OF THE EB-5 CATEGORY
The EB-5 Category is an excellent opportunity for many foreign nationals to become permanent residents of the United States.
The Regular Program
A person investing $500,000 in certain circumstances or $1 million in a business that creates 10 jobs may be granted EB-5 permanent resident status. The basic government criteria for this excellent status are:
- Investment must be in a business, not a passive security such as the stock market;
- Invested funds must be the individual's, but may be a gift from a parent or other person, provided the appropriate gift taxes are paid, if required;
- The business must have been created after November 29, 1990 or the investment must substantially change an older business;
- The amount of investment may be $500,000 in a rural or high unemployment area; and
- Create 10 jobs – no direct job creation is required if the investment is in a "Regional Center" (see below).
The Regional Center Program
To encourage immigration through the EB-5 category, Congress created a Regional Center program in 1990. 3,000 visas have been set aside each year for people to invest at least $500,000 in designated Regional Centers. The Regional Centers program does not require the immigrant investor enterprise itself to employ 10 U.S. workers. Instead, it is sufficient if 10 or more jobs are created indirectly as a result of the investment. Regional Centers are designated as "any economic unit, public or private, which is involved with the promotion of economic growth, including increased export sales, improved regional productively, job creation, or increased domestic capital investment." The investment requirement is only $500,000 if a Regional Center is in a targeted employment area, which is either in a rural or high unemployment area, as defined hereinafter in the section on EB-5 Regulations. In 2003, Congress gave CIS (formerly INS) discretion to "give priority" to EB-5 petitions filed through a Regional Center. Once Permanent Resident status is granted, minimal involvement with the investment is permitted, allowing the applicant to work in any business, go to school, or enjoy retirement.
Procedures
EB-5 Permanent Resident status involves making the investment, filing the appropriate petition at a CIS Service Center, and applying for an Immigrant Visa at a United States consulate or applying for Adjustment of Status in the U.S. After "Conditional" Resident Status (Green Card) is granted, the individual must wait one year and nine months to file an application to remove the "conditional" status. With this application, evidence of the creation of the 10 jobs, if necessary, is required as well as proof the entire investment has been made. Upon approval of the application by CIS, the applicant is granted Permanent Resident status.
The CIS has been approving qualifying EB-5 cases following controversy in the 1990s over interpretations of the relevant regulations.
We can analyze business opportunities and advise you whether they may qualify for an EB-5 Green Card. We do not, however, give business advice or analyze an investment for determining financial viability. You are encouraged to hire accounting and business law experts to conduct a due diligence analysis of the investment.
