Entrepreneurship & EB-5 Investor Visas

Investing & Entrepreneurship

Presented by:

Matt Morse, Fakhoury Law Group

Karen Phillippi, Office for New Americans

Overview of Immigration CategoriesNon-Immigrant Visas Immigrant Visas

A, B, C, D, E-1, E-2, F, J, G, H-1B, H-2B, I-1, K-1, L-1, M, O-1, P, Q, TN, R, T, U, V, etc.

EB-1• Extraordinary Ability• Multi-National Manager/Executive• Outstanding Professors/Researchers

EB-2• Advance Degreed Professionals• National Interest Waiver

EB-3ProfessionalsSkilled Workers

EB-4 (Certain Special Immigrants)

EB-5• Employment Creation

F-1 Category

As student while completing course of study:

• F-1 students permitted to be passive investors in a business

• Cannot work on business or engage in business activities

• Cannot do volunteer work for business

• Limited planning of business is permitted

As student during Optional Practical Training (OPT) period:

• Can be self-employed while on OPT

• Employment must be approved by DSO

• Must work full-time

• Must engage in business related to the field of study

• Must have business license

H-1B CategoryGeneral Rule: No self-employment

Exception: USCIS issued policy memorandum in August 2011 that stated self-employed foreign national may file H-B petition for themselves, if certain criteria are met:

• Company (business entity) has to have independent control over the foreign national

• Partnership or corporation should be selected for the business entity, rather than sole proprietorship

• Petitioner has to offer bona fide job to foreign national• The position offered must be a professional position• Petitioner must have revenue to pay the required wage• Beneficiary must have a related degree• Some intent to create U.S. jobs required.

O-1 Category• Extraordinary ability in the sciences, arts, business, or athletics.

• National or international acclaim by receipt of a major internationally recognized award, or documenting at least three (3) of the following:

• Receipt of nationally or internationally recognized awards• Membership in an organization that requires outstanding

achievement• Published materials about the foreign national in a trade

publications• Evidence the foreign national has judged the work of others• Original scientific or scholarly work of major significance • Evidence of authorship of scholarly work or articles;• Evidence of employment in a critical or essential capacity• Evidence the foreign national has commanded a high salary

E-2 Category

• Must be a national of a treaty country

• Foreign national must put forth a substantial investment of money, sufficient to ensure the successful operation of the business

• The investment must be a real operating enterprise (Speculative or idle investment does not qualify)

• The business venture must have a significant economic impact in the U.S.

• Money for the investment must be at risk

• Source of the money must be legitimate

• Foreign national must come to the U.S. to develop and direct the business venture

• E-2 is given in two (2) year increments

EB-1 (Alien of Extraordinary Ability)• Extraordinary ability in the sciences, arts, business, or athletics. • National or international acclaim by receipt of a major internationally

recognized award, or documenting at least three (3) of the following:

• Receipt of nationally or internationally recognized awards• Membership in an organization that requires outstanding

achievement• Published materials about the foreign national in a trade

publications• Evidence the foreign national has judged the work of others• Original scientific or scholarly work of major significance • Evidence of authorship of scholarly work or articles;• Evidence of employment in a critical or essential capacity• Evidence the foreign national has commanded a high salary• Other

EB-2 (Advance Degreed Professional Seeking a National Interest Wavier)

• Must have exceptional ability in the sciences, arts, or business, and whose work is in the national interest

• Matter of New Department of Transportation (NYSDOT) established a three prong test:

1) Activity must have substantial intrinsic merit;

2) The benefit is national in scope;

3) The national interest adversely affected if a PERM labor certification is required

• USCIS guidance indicates entrepreneurs should show job creation both locally, and spin off jobs created nationally

EB-2 (Advance Degreed Professional Seeking a National Interest Wavier)

(continued)• Besides showing activity is in the U.S. national interest, must also

meet three of the following criteria:

1) Evidence of advance degree;

2) letters documenting at least ten (10) years of experience;

3) a license to practice in the profession;

4) evidence of a high salary, compared to others in the field;

5) membership in a professional organization;

5) evidence of significant contributions in the field;

6) other comparable evidence.

What is EB-5?• Pathway to Permanent Green Card

• Immigrant investor visa

– Employment-Based 5th Preference Visa

– U. S. Citizenship and Immigration Services

– 10,000 visa numbers available per Fiscal Year

• Stimulate economy through job creation and

foreign investment

• 2 levels based on TEA designation

How Does EB-5 work?• Investment

– $1,000,000 or $500,000 if TEA

– At Risk

• TEA

– Rural Area (population less than 20,000)

– Area with 150% above national unemployment average

• New Commercial Enterprise

– For profit

– Formed after 11/29/90

• Possible with entity created prior to this date, but must meet certain criteria

• Job creation

– 10 full-time jobs for US workers

EB-5 Options• Individual investor

– Buys or starts new business

– Wants to manage/be actively involved in day-to-day business

– Wants to control investment and maximize profits

• Regional Center

– 779 in the US (9 in Michigan)

– Indirect jobs may count

– Individual does not want to actively manage

– Should conduct due diligence on the RC

EB-5 Process

• Preparation and filing of immigrant investor petition to demonstrate:

– Sufficient funds

– Lawful source of funds

– Any spouse and/or children under 21

• If approved, conditional resident for 2 years

– Must file to remove conditions & prove met all criteria for EB-5 program

Lawful source of funds

• Earned income– Document how earned

– Tax returns

• Gifts– Document giftor’s lawful obtainment of funds

– Show taxes paid on the gift amount

• Investor’s company– Must document flow of money from company to

investor (no retained earnings)

• How get money to the US?

Processing Times• I-526 (Immigrant petition)

– 12 to 16 months

– Either Consular Processing or AOS• Could add another 6 to 9 months

• I-829 (Petition to remove conditional residence)– 6 to 9 months

• Frequent RFEs– Delays process

Contact Information

Matt Morse

Fakhoury Law Group

[email protected]

Karen Phillippi

Office for New Americans

[email protected]