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How much of the EB-5 direct investment I can reserve for employees and rent?

I am planning to make a direct EB-5 investment. Since it will be a new business, I do not know how much profit I will make during the initial two year period. That''s why I want to reserve some funds for 10 employees'' salaries and the rent. Is there any limit on the funds that I can reserve? For example, $250,000 for the salaries and $75,000 for the rent?

Answers

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    Ed Beshara

    Immigration Attorney
    Answered on

    The EB-5 compliant business plan has to clearly state how the funds are going to be used and committed to cause the creation of 10 direct full-time employees during the two and a half years after the approval of the I-526 petition.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    There is no particular limit. Your comprehensive business plan should address projections and, based on that, you may reserve funds.

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    John J Downey

    Immigration Attorney
    Answered on

    USCIS does not have limits per se, but it all depends on your business plan. If it makes sound business sense, then it should be accepted by the examiner.

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    Steffanie J Lewis

    Immigration Attorney
    Answered on

    The invested funds must be working and at risk. If you reserve the funds, they cannot be working to create income and if they are reserved, they are safe and not at risk. If you plan to use investment funds to pay salaries or rent, those expenses must be identified in the Use of Proceeds portion of your business plan and USCIS may not approve such use of funds and deny the investor's I-526 petition. Before initiating your business plan, discuss the plan with an experienced attorney.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    There are no restrictions on setting aside parts of the investment for wages or rent.

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    Xiaosheng Huang

    Immigration Attorney
    Answered on

    No limit. You need to provide the business plan and you have to describe how to use your fund in it.

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    Johanna Keamy

    Immigration Attorney
    Answered on

    You stated that you are planning to make a direct EB-5 investment in a new business and that you are not sure how much profit you will make in the initial two year period. As I understand it, you would like to reserve a portion of the $1 million investment for salaries and rent. You would need a very detailed and carefully drafted business plan with projected business profits including salary. In addition, you will need to submit a commercial lease with a specific rental amount. You may show irrevocable commitment by paying the lease in its entirety or segregate funds for the lease that is held in the business bank account of the legal entity. Funds for salaries should be reserved according to the business plan and perhaps an accountant, payroll company or bookkeeper will allocate funds for payroll pursuant to the business plan. Therefore, the amount you reserve for salary and rent depends on your EB-5 business plan and lease.

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