EB-5 Immigrant Investor Visa Category: Everything You Need To Know

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If you are keen on the EB-5 immigrant investor visa category, then the information in the this easy to read and comprehensive article may prove valuable.

Background: Why was the EB-5 immigrant investor visa category created?

The EB-5 immigrant investor visa category was created by Congress in 1990. The purpose was to incentivize eligible wealthy foreign entrepreneurs to invest capital in job creating or job preserving enterprises in exchange for lawful permanent residency in the U.S. for themselves and their immediate family. The goal was to stimulate the U.S. economy and add or preserve full-time jobs for qualified U.S. workers.

READ: EB-5 Program's History Over The YearsIn 1992, Congress launched the Immigrant Investor Pilot Program, which is more commonly known as the Regional Center Program. With the 1990 program, EB-5 applicants invested directly in new commercial enterprises, whereas, with the 1992 program, EB-5 applicants invested in designated Regional Centers. The benefit of a regional center is two-fold. First, a regional center could pool investments and fund large-scale projects. Second, the Regional Center Program expanded the job creation definition to include indirect and induced jobs, and therefore made it easier to fulfill the EB-5 Program requirements.READ: What Is Direct, Indirect, and Induced Job Creation?The Immigration and Nationality Act authorizes roughly 10,000 visas for EB-5 investors annually. Approximately 3,000 of the 10,000 are allocated to Regional Center Program investors who fund projects located in targeted employment areas (TEA). It is popular for investors to fund Regional Center projects located in TEA because they qualify for the lower investment amount of $500,000 instead of the $1 million the regular stand-alone program requires. TEA are areas that are either rural or have high unemployment rates. The reason TEA have a lower minimum investment amount is to encourage investors to fund projects located in areas that would greatly benefit from increased employment creation.READ: How To Invest In A Targeted Employment Area (TEA)Eligibility: Who can apply to the EB-5 investor visa category?A qualified investor-petitioner in the non-Regional Center stand alone EB-5 Program as well as the Regional Center Program must be an immigrant investor who can:1. Make a capital investmentThe immigrant investor must place $1 million, or in many cases $500,000, in an at-risk investment. Capital can include cash, inventory, equipment, property, or even loans secured by an investor's personal assets. The immigrant investor must be able to prove they are legally the owner of the capital and that it was all obtained through lawful means. Immigrant investors must provide evidence to prove their lawful sources of funds. READ: How To Make An EB-5 Investment Using A Loan2. Invest in a new commercial enterpriseThe immigrant investor must provide proof that they made their investment or they are actively in the process of making the investment with their own funds. To qualify for the EB-5 Program, the immigrant investor's funds must be placed "at-risk." Placing funds "at-risk" means that the immigrant investor cannot be guaranteed returns on their investment. Their investment must be at risk for loss as well as have a chance for gains. An investor must also provide proof that their capital investment was made fully available to the commercial enterprise and used for business activity.Fees such as administrative fees, attorney fees, management fees and the like, do not count toward the required minimum capital investment and must be made in addition to the minimum investment amount.In some cases, an EB-5 immigrant investor's capital may be held in escrow until their I-526 Immigrant Petition by Alien Entrepreneur is approved and they receive conditional permanent residency (green card status).READ: How Is An EB-5 Escrow Account Different From A Typical Escrow Account?3. Invest in a project that creates 10 full-time jobsThe main requirement of the EB-5 Program is that each immigrant investor invest capital into a new commercial enterprise that creates or preserves at least 10 full-time jobs for qualifying U.S. employees. If the immigrant investor contributes capital to the stand-alone program, they must create at least 10 direct jobs. However, if they contribute to the Regional Center Program, the requirement is easier; they must create at least 10 direct, indirect or induced jobs. Since each investor must be credited with the creation of at least 10 jobs, this limits the amount of capital project managers can raise. If a TEA project is projected to only create 30 jobs, then a project manager can only raise $1.5 million in EB-5 capital from 3 immigrant investors. Investing: How do you begin the EB-5 investment process?The process involves selecting an investment project, finding an experienced immigration attorney and filing and preparing the necessary documentation. 1. Selecting an ideal projectIt's important for an immigrant investor to find a suitable project that fits their investor profile. To determine their investor profile, some questions candidates can ask themselves include:

  • Am I interested in the day-to-day management of the investment or would I rather have a regional center handle that?
  • What are my primary investor objectives?
  • What is my risk tolerance?
  • What industries do I feel comfortable investing in?

You can narrow your search by only conducting due diligence on projects that are compliant with U.S. securities regulations. To avoid fraud, conduct thorough due diligence once you've found a project that catches your interest. To read more about the documents you'll want to review once you've selected a project, visit: Selecting An Project EB-5 Investment. Once you've chosen a project that matches your needs, visit the project location.2. Find a knowledgeable and experienced EB-5 immigration attorneyFinding a qualified immigration attorney is important because EB-5 is a complex specialty area of law. What is your attorney's background? Do they have EB-5 experience? Are they knowledgeable about business as well as immigration? How many EB-5 cases has the attorney handled? Does the attorney communicate effectively with you? In addition to filing Forms: I-526, I-485 and I-829, an EB-5 immigration attorney can assist with analyzing and advising on projects, assisting with due diligence, gathering evidence, tracking source of funds, providing expertise on immigration laws, reviewing project exit strategies, and discussing timelines.3. Preparing and filing the necessary formsWhy must an EB-5 investor use an immigration attorney? An immigration attorney will not only file all the necessary petitions, but they will assist the EB-5 applicant with compiling the required evidence so that the process goes smoothly and the petitions are not delayed or denied.I-526 Form:The I-526 Petition by Alien Entrepreneur is a form that demonstrates that the investor has either already made their investment into a qualified project or they are in the process of making the investment. What are the requirements?

  • Evidence showing that the project is suitable and that the immigrant-petitioner either made the $500,000 or $1 million investment into the project or are in the process of making the investment
  • Evidence that the investment funds came from lawful sources
  • Evidence showing that the investor will either manage the daily activities of the investment or that they will be a policy adviser
  • A business plan showing that the investment will create a minimum of 10 full-time jobs for qualified U.S. workers

I-485 Application:Once the I-485 Application to Register Permanent Residence or Adjust Status is processed, an EB-5 investor becomes a U.S. conditional permanent resident. What are the requirements?Providing copies of:

  • Birth certificate
  • Marriage certificate
  • Passport
  • Non-immigrant visa
  • Vaccination records
  • Medical examination documents
  • Form I-797 C from their approved I-526 Petition

As well as:

  • Fingerprints
  • Recent color photos
  • Signatures
  • Criminal history documents if applicable

I-829 Petition:The I-829 Petition by Alien Entrepreneur to Remove Conditions on Permanent Resident Status is filed by the EB-5 investor in order to remove the residency conditions and become lawful permanent residents of the United States. What are the requirements?

  • An investor must have a conditional green card
  • Legal documents must be submitted if the investor has a criminal history
  • Evidence that the investor made the required investment into a qualified new commercial enterprise
  • Evidence that the qualified new commercial enterprise was sustained during the EB-5 investor's two years of conditional permanent residency
  • Evidence showing that the requisite number of jobs were created
  • Evidence that the EB-5 investor's fingerprints, signatures, and photos were taken

READ: Young Couples Invest In The EB-5 Program For The American DreamWhat questions are left for EB-5 investors to ask themselves?One of the biggest decisions an EB-5 investor will make is whether they want to invest in the direct program or the Regional Center Program. READ about the Pros and Cons of The EB-5 Direct Investment.

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