EB-5’s: The basics
Question: Is EB-5’s as simple as investing $1,000,000 in a business and getting the Green Card?
Answer: It is anything but simple. First, you need to make sure you have an experienced EB-5 attorney to process the case because there are many cases that have multiple issues and problems.
Question: Has the EB-5 decreased with the recession?
Answer: Actually, it has increased. Investing in U.S. is now a very enticing option because of the decrease in dollar and the bad economy. For people outside the U.S. with the sufficient funds, they can get a much better deal than they used to get in years past.
Question: When is the program set to expire?
Answer: There has just been another 3 year extension.
Question: What type of investments are being made?
Answer: Actually, the traditional investment is being used much less. Primarily, there has been such harsh adjudication of the typical investment that people have been turning much more to Regional Centers. Actually, about 70-80% of EB-5’s now are with Regional Centers investors. Regional Centers could be for graduating students with presents of $500,000 from parents; retirees to not want to work every day; very successful businesman who’s children are having trouble getting into their own country’s schools or want a better education in the U.S. EB-5 can be used so son or daughter can also adjust and get education in the U.S.
Question: What are the basic requirements if the investor does not invest in a Regional Center.
Answer: EB-5 cases that are not Regional Centers must invest in a new commerical enterprise. Many times on an RFE, the government will require IRS records with someone whom you have no privity of contract. If you purchase an existing business, you MUST show an increase of 40% of the investment. Thus, it would be preferable to start a new business.
There must be a lawful source of funds. You need the 5 last tax returns, proof how you got the funds, how it was transferred, how every penny was brought into the U.S. You can hire a company to help trace where the funds came from which might be better in the long run. If you take the Regional Center route, the 10 jobs can be shown indirectly by an econometric model.
You must do a comprehensive business plan. There is a 2 year requirement time window to show that the jobs will be created.
In sum, each requirement has its own complexities which must be verified, argued and presented.