About the EB-5 Visa Classification
The immigrant investor visa was created in 1990 to benefit the U.S. economy through employment creation and an influx of foreign capital into the United States. The visa is also referred to as the because it is the fifth employment preference immigrant visa category. The EB-5 visa provides (i.e., LPR status) to foreign nationals who invest a specified amount of capital in a new commercial enterprise in the United States and create at least 10 jobs. The foreign nationals must invest $1,800,000, or $900,000 if they invest in a rural area or an area with high unemployment (referred to as targeted employment areas or TEAs).
EB-5 Classification Requirements
The EB-5 visa classification for foreign investors is based on three components:
(1) investment of capital,
(2) a new commercial enterprise, and
(3) job creation.
Currently, there are two different pathways for lawful permanent resident (LPR) status through the EB-5 visa category, the standard visa and the Regional Center Program. The overwhelming majority of investors invest through the Regional Center Program. Both pathways have the same requirements with respect to the amount of capital required to be invested and the minimum number of jobs to be created, but they differ in the measure of job creation. In addition, the role of the investor in the enterprise tends to differ between the two pathways
Investment of Capital
A foreign national must invest at least $1,000,000 in a new commercial enterprise to qualify for the EB-5 visa. If the immigrant decides to invest in a designated “,” (TEA) the required minimum is $900,000. For both investment pathways, capital can include non-cash contributions, but the must establish that he/she is the legal owner of the capital and that it was obtained through lawful means. Additionally, the entire investment must be “at risk” for the purpose of generating a return.
A New Commercial Enterprise
A is “any for-profit activity formed for the ongoing conduct of lawful business,” such as a sole proprietorship, partnership, holding company, joint venture, corporation, business trust, or other publicly or privately owned entity. A new commercial enterprise is one established after November 29, 1990. If the commercial enterprise was established before November 29, 1990, the immigrant investor’s capital must have been used to expand or restructure/reorganize the enterprise. Applicants are also allowed to invest funds in “troubled businesses.”The immigrant investor must be engaged in the management of the commercial enterprise through policy formation, daily managerial responsibilities, or direct management.
Job Creation
In order to meet the requirements for the , the foreign national’s investment capital must create a minimum of 10 jobs in the new commercial enterprise. The EB-5 visa has three different measures of job creation.
can be created directly or indirectly (i.e., employees not working directly for the commercial enterprise).
A troubled business is a business that has been in existence for at least two years and has incurred a net loss during the 12- or 24-month period prior to the priority date on the immigrant investor’s Form I-526. The loss for this period must be at least 20 percent of the troubled business’ net worth prior to the loss. For purposes of determining whether the troubled business has been in existence for two years, successors in interest to the troubled business will be deemed to have been in existence for the same period of time as the business they succeeded.
Full-time employment means employment of a qualifying employee by the new commercial enterprise in a position that requires a minimum of 35 working hours per week. In the case of the regional center program, "full-time employment" also means employment of a qualifying employee in a position that has been created indirectly that requires a minimum of 35 working hours per week.
A job-sharing arrangement whereby two or more qualifying employees share a full-time position will count as full-time employment provided the hourly requirement per week is met. This definition does not include combinations of part-time positions even if, when combined, the positions meet the hourly requirement per week.
Jobs that are intermittent, temporary, seasonal, or transient in nature do not qualify as permanent full-time jobs. However, jobs that are expected to last at least 2 years are generally not considered intermittent, temporary, seasonal, or transient in nature.
The immigrant investor visa was created in 1990 to benefit the U.S. economy through employment creation and an influx of foreign capital into the United States. The visa is also referred to as the because it is the fifth employment preference immigrant visa category. The EB-5 visa provides (i.e., LPR status) to foreign nationals who invest a specified amount of capital in a new commercial enterprise in the United States and create at least 10 jobs. The foreign nationals must invest $1,800,000, or $900,000 if they invest in a rural area or an area with high unemployment (referred to as targeted employment areas or TEAs).
EB-5 Classification Requirements
The EB-5 visa classification for foreign investors is based on three components:
(1) investment of capital,
(2) a new commercial enterprise, and
(3) job creation.
Currently, there are two different pathways for lawful permanent resident (LPR) status through the EB-5 visa category, the standard visa and the Regional Center Program. The overwhelming majority of investors invest through the Regional Center Program. Both pathways have the same requirements with respect to the amount of capital required to be invested and the minimum number of jobs to be created, but they differ in the measure of job creation. In addition, the role of the investor in the enterprise tends to differ between the two pathways
Investment of Capital
A foreign national must invest at least $1,000,000 in a new commercial enterprise to qualify for the EB-5 visa. If the immigrant decides to invest in a designated “,” (TEA) the required minimum is $900,000. For both investment pathways, capital can include non-cash contributions, but the must establish that he/she is the legal owner of the capital and that it was obtained through lawful means. Additionally, the entire investment must be “at risk” for the purpose of generating a return.
A New Commercial Enterprise
A is “any for-profit activity formed for the ongoing conduct of lawful business,” such as a sole proprietorship, partnership, holding company, joint venture, corporation, business trust, or other publicly or privately owned entity. A new commercial enterprise is one established after November 29, 1990. If the commercial enterprise was established before November 29, 1990, the immigrant investor’s capital must have been used to expand or restructure/reorganize the enterprise. Applicants are also allowed to invest funds in “troubled businesses.”The immigrant investor must be engaged in the management of the commercial enterprise through policy formation, daily managerial responsibilities, or direct management.
Job Creation
In order to meet the requirements for the , the foreign national’s investment capital must create a minimum of 10 jobs in the new commercial enterprise. The EB-5 visa has three different measures of job creation.
- If an immigrant invests in a troubled business, directly or through a regional center, rather than creating new jobs, he/she can show that they have preserved jobs for at least two years, in lieu of creating new jobs.
- Investments made in a new commercial enterprise in a non-regional center context must create 10 jobs within the commercial enterprise. (Such jobs are called direct or payroll jobs.)
can be created directly or indirectly (i.e., employees not working directly for the commercial enterprise).
A troubled business is a business that has been in existence for at least two years and has incurred a net loss during the 12- or 24-month period prior to the priority date on the immigrant investor’s Form I-526. The loss for this period must be at least 20 percent of the troubled business’ net worth prior to the loss. For purposes of determining whether the troubled business has been in existence for two years, successors in interest to the troubled business will be deemed to have been in existence for the same period of time as the business they succeeded.
Full-time employment means employment of a qualifying employee by the new commercial enterprise in a position that requires a minimum of 35 working hours per week. In the case of the regional center program, "full-time employment" also means employment of a qualifying employee in a position that has been created indirectly that requires a minimum of 35 working hours per week.
A job-sharing arrangement whereby two or more qualifying employees share a full-time position will count as full-time employment provided the hourly requirement per week is met. This definition does not include combinations of part-time positions even if, when combined, the positions meet the hourly requirement per week.
Jobs that are intermittent, temporary, seasonal, or transient in nature do not qualify as permanent full-time jobs. However, jobs that are expected to last at least 2 years are generally not considered intermittent, temporary, seasonal, or transient in nature.
