Posts Tagged ‘ EB-5 investments ’

EB-5 Regional Center Program Made Permanent

Posted on: September 11, 2013 by in EB-5
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bigstock-Business-meeting-in-an-office-21258410The United States’ EB-5 Regional Center program has finally made the leap from pilot program to permanent program and will continue to help the U.S. economy by encouraging foreign investors to invest a substantial amount of capital into a U.S. based business venture. The Regional Centers program, which was launched in the 1990s as a pilot program, has been extended and saved from expiration by Congressional vote since that time – but now that the program is permanent, there is no need for Congress to vote to keep the program every few years, and no risk that the program will be pulled before a foreign investor is able to take advantage of it.

What is a Regional Center

A regional center is a publicly or privately controlled entity (most Regional Centers are privately controlled) that is specifically involved in promoting economic growth. When a foreign investor intends on making an investment into the U.S. economy under the EB-5 program, the investor has the option of directing the investment of funds on his or her own, or allowing a regional center to direct the investment of funds on the investor’s behalf.

The EB-5 investor program is extended to just about any foreign citizen who can come up with the amount of capital necessary to qualify under the program (either $500,000 or $1,000,000). However, many foreign investors who have the investment capital necessary to qualify under the program do not have any desire to direct and manage an investment of such a size. If this is the case, the Regional Center program offers a great alternative to self directed investment by letting the investor move the funds into a Regional Center where the Center will control and invest the funds on the foreign investor’s behalf.

Benefits of Investing in a Regional Center

Along with being able to take a hands off approach to investing in a U.S. based business venture, foreign investors who invest in the United States through a Regional Center also have the benefit of knowing that their funds will be professionally maintained and invested. Plus, since an EB-5 investor visa can be revoked if the foreign investor’s investment is unable to meet the standards directed by the program, having a Regional Center with experience in making successful investments will go a long way in helping to make sure that the investor’s visa is not revoked for failure to satisfy the program.

Moving Forward with an Attorney

While there is no way for an attorney to guarantee that an investment will work, a foreign investor should still partner with an attorney because of all of the help and counsel that the attorney will be able to provide in the matter. The attorney can help the foreign investor apply for the EB-5 visa and compile the necessary supporting documents that should accompany the application. Once the paperwork has been submitted, the attorney will keep the foreign investor up to date on the status of his or her application.

Using Rental Income for an EB-5 Investment

Posted on: August 9, 2013 by in EB-5
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bigstock-Citizenship-documents-43205116Foreign citizens interested in applying for an EB-5 investor visa will no doubt have several questions about the visa itself and the application process. They may wonder what they need to do to qualify for the program and how to go about applying for the visa once the qualification requirements are met. The reason for so much hesitation is not unfounded, as U.S. immigration policy is inherently complex and continues to evolve. This is one of the main reasons why foreign investors should work with a qualified and experienced immigration attorney to facilitate the process.

Funding the EB5

In order to qualify for an EB-5 investor visa, foreign investors must invest at least $500,000 into an American based venture from a predesignated, hard hit and financially struggling industry, or at least $1,000,000 into a business of any other industry. For many foreign investors, coming up with the minimum required amount of investment capital is not a challenge. However, the United States has notoriously stringent proof of income requirements when it comes to foreign funds being allowed to enter the U.S. economy. Any income earned by a foreign investor to be invested into a U.S. based business venture must have been earned through a provably legitimate source. The federal government requires foreign investors to show that their investment funds were legitimately earned in order to avoid promotion of organized crime and terrorism.

Income Legitimacy

So long as an income has been earned legitimately, there are nearly no limits on where the funds can come from. If a foreign investor earns the money from rental property, this should not present any problems. To show the income was earned legitimately, foreign investors can present bank statements and tax documents along with an EB-5 visa application.

Other Requirements

In addition to meeting minimum investment amount requirements, the cash invested must create at least 10 jobs for American workers, if the cash is invested in a new U.S. based venture, or must expand a business’s net worth or employee force by at least 40%, if the cash is invested into an existing U.S. based venture. Additionally, the investment must have already been made, or a substantial step toward the investment already made, by the time the EB-5 visa application is submitted.

One thing that investors need to realize is that simply making an investment is not enough. After an application is approved, a conditional visa can be issued. If the business venture into which the capital was invested, however, is unable to sustain the 10 America jobs or the 40% expansion of the business for a set amount of time, then the investor will be unable to transition from the conditional visa to a permanent visa.

Regional Center Benefits

Along with investing directly into a business venture, foreign investors can invest in Regional Centers, which are privately held corporate entities that direct and manage EB-5 investment funds into regionally based business ventures on behalf of foreign investors. This offers a bit of security to the foreign investor because those who invest in Regional Centers are more likely to see their investment succeed than those who try investing into a business directly.

Guaranteed EB-5 Investments

Posted on: July 12, 2013 by in EB-5
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Investing in the U.S. for an EB-5 Visa

The EB5 investor program allows foreign investors the chance to live and work in the U.S. in exchange for a substantial contribution in America’s economy. Some of the rules involved require the amount invested to meet minimum investment amounts and, if invested into a new venture, to create at least 10 jobs for U.S. workers or, if invested into an existing venture, to expand the business by at least 40%.

Getting a Guaranteed Investment

Unfortunately, in order to qualify for an EB-5 visa, foreign investors are not allowed to accept any form of guarantee that an contribution will be profitable. In other words, the investment must be “at risk”, or unguaranteed, for the time that it is invested into a qualifying U.S. based venture. If the expense were guaranteed, then it would be more of a loan, not a true investment.

After an expense is made, the foreign investor can be issued a conditional EB-5 visa, however, if the expense fails to create the necessary amount of jobs or, in the case of an contribution into an existing venture, fails to expand the business by 40%, the visa can be revoked. In other words, an expense must be provably profitable in order for an EB-5 visa to stay in effect.

What if an Investment is Lost?

If an expense is lost, there is no legal recourse for the investor. A lost contribution is a lost investment, which is why investors must understand the risks involved with making an contribution into a foreign venture.

Even if the party receiving the contribution makes a promise to repay an contribution if it is lost, the law will generally not step in to make the investor whole in the event that the contribution is actually lost.

What Does This Mean for Investors?

Foreign investors interested in investing in the U.S. economy must make absolutely sure that the venture into which they are investing is legitimate and has a high chance of success. Rushing into an investment just to become eligible for an EB5 visa can actually lead to the investor making a bad investment, or failing to see one of the risks involved with the investment. For the most hopeful results, foreign investors are urged to perform ample due diligence into a potential expense opportunity to ensure the contribution  is as secure as possible.

How to Make a Strong Investment

The fact that an EB5 expense is at risk means that investors have a lot on the line if they make a bad investment. In terms of an EB5 investment, not only would the investor lose the cash that went into the investment, so too could the investor lose the opportunity to remain in the U.S. on an EB5 visa because, if an contribution fails, an investor’s conditional visa can be revoked.

An experienced immigration and EB-5 attorney can help the foreign investor ensure that an contribution is legitimate and can advise the investor on the precise risks involved with an investment.