Under the American Immigration Act of 1990, Congress enacted the EB-5 (investor) visa. This highly underutilized category has posed to be a useful way for certain individuals to immigrate to the United States and obtain a green card. The intent of the program is to encourage the flow of foreign capital into the U.S. economy and to create jobs for U.S. workers.

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10,000 visas in the EB-5 category are available each year, with 3,000 reserved for investors who want to participate in an EB-5 pilot program designed for target employment areas or “TEAs” (a rural area or an area experiencing unemployment of at least 150 percent of the national average rate). Recently, the United States Citizenship and Immigration Services (USCIS) has initiated a campaign to spur interest in the program and generate job growth in the country.

Highlights of the program include: the foreign investor must have $1 million in the US business and it must create at least 10 full-time jobs for U.S. workers. Alternatively, for those individuals who prefer to take a more passive approach, foreign investors can contribute $500,000 into a Regional Center situated in a TEA. About 90 percent of the money is funneled through private companies, known as regional centers, which match overseas investors with businesses in need of capital. These companies are authorized to participate in the program by legislation that expires every few years. Under the Regional Center program, the immigrant investor enterprise itself does not need to employ 10 U.S. workers, it only requires that 10 or more jobs are created indirectly as a result of the investment.

There is no wait period to obtain the green card. The EB-5 program provides a conditional green card to the applicant and his/her family immediately upon approval by the USCIS. The investor can arrive in the United States knowing that he and his family have permanent resident status and can apply for U.S. citizenship after 5 years.

The EB-5 regulations require the investor to prove the invested capital was “obtained through lawful means.” The regulations requires proof of foreign business registration records; tax returns filed within 5 years; evidence identifying any other source of capital, such as proceeds from the sale of real estate, inheritance, etc. This in itself is a challenge for many Indian nationals. It can be especially difficult in countries where no tax returns are required to be filed or where full disclosure of revenues and profits on tax returns is the exception rather than the rule. Where tax returns are not required to be filed, this should be documented. Where tax returns are required to be filed but the individual’s tax returns show very little income, the documentation of the source of funds should provide overwhelming evidence to counter the negative implication that comes from a review of the tax returns.

Given the current state of the economy, this may prove to be a win-win situation not only for the United States, but also for the investor. For individuals with investment capital, the EB-5 visa provides a quick pathway for a green card.

Immigration and business attorney Indu Liladhar-Hathi has an office in San Jose. (408) 453-5335.

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