3 Things You Should Know About the EB-5 Visa Program Before Starting a Business in the USA

For investors and entrepreneurs seeking a green card in the United States, the EB-5 visa is your best bet.

What is the EB-5 Visa Program?

The EB-5 visa program is a visa application process created by the Immigration Act of 1990, which allows foreign citizens to receive a green card by investing in a “new business company” in the United States.

It enables foreign individuals, their spouses, and unmarried children under the age of 21 to acquire green cards under certain requirements.

However, it’s worth noting that the application for the EB-5 visa investments isn’t particularly straightforward, hence, you’ll need to seek professional advice and gather more information about the investment process in a bid to make a successful application.

Still, there are two things you should know about the EB-5 Visa before you even consider applying for it – namely; The requirements for the EB-5 visa application as well as the ways you can invest in the EB-5 Visa program.

Without further ado, here’s a comprehensive look at them;

Requirements for the EB-5 Visa Application

To be eligible for the EB-5 visa, you must satisfy the following requirements;

You Need To Invest in a Business in the United States

An application for the EB-5 visa requires you to invest in a new commercial enterprise. 

The investment must be at least $1,800,000 in a business in the United States. An alternative is to invest in a targeted employment area, which qualifies you for a $900,000 reduction.

You Need To Create Jobs Through Your Investment

Another requirement for the EB-5 visa is the money invested must create at least ten full-time jobs for United States citizens. 

Your Investment Should Be “At-Risk” 

At-risk investment means the investment you made in the business must be active and not just sitting in the business’s operating account. 

The money cannot just be in the bank or serve as a reserve for the company you allegedly invested in.

This implies that the investment must be subject to profit or loss, and you cannot receive any form of guarantee that your investment will be returned to you if anything goes wrong with the business.

It also means that a loan made to a corporation cannot be disguised as an investment in the business.

However, this requirement only stands until you become an unconditional permanent resident, that is until you get a green card.

Management of the Commercial Enterprise

This condition requires you to be part of the business venture you are investing in.

You are required to have some form of managerial position in the business or be a member of the corporation’s board. 

Ways to Invest in the EB-5 Visa Program

There are three major ways to make your investment;

Investing in a Business in the United States

This is also known as a direct investment. According to the USCIS, to be eligible for the EB-5 visa program, you have to invest $1,800,000 in a new commercial enterprise, which means you must start a business in the United States using the money. 

However, you don’t have to start a business from scratch, you could also buy an existing business.

An important of this requirement is that it must be a profitable enterprise, meaning investing or donating to a non-profit organization does not qualify as an investment for this purpose.

The commercial enterprise can also be of any type: sole proprietorship, partnership(either limited or general), joint venture, or business trust which may be publicly or privately owned. If the business is structured as an LLC or similar, you should also be aware of how to file self-employment taxes.

In addition to investing the requisite amount, the condition requires the company to create ten full-time jobs for Americans. 

Investing in a Targeted Employment Area

Suppose the investment is made in a “targeted employment area,” you will be eligible for a reduction of $900,000. 

The Immigration and Nationality Act defines a targeted employment area as a region with a high unemployment rate or a rural area.

In addition, the Act goes further to define an area with a high unemployment rate as any region with an unemployment rate above 150% of the national average. 

And it defines a rural area as a region not located within any city or with a population of less than 20,000.

Investing in a Regional Center

This means investing in a specialized business regulated by USCIS (U.S. Citizenship and Immigration Services) that pools money from EB-5 investors to construct large-scale projects like hotels or apartment complexes.