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How can a submitted EB-5 application be corrected?

My friend applied for EB-5. She was told that she only needed to report $500,000 on the application when she applied. The application was approved. Now, a year later, she wants to bring her $12 million to the United States, and found out she must pay taxes on the additional $11.5 million that she failed to report on her EB-5 application. Is there any way to still correct the reported assets on her EB-5 application? How can she now legally bring her assets to the United States?

Answers

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    Ed Beshara

    Immigration Attorney
    Answered on

    The EB-5 regulations require the investor to prove the lawful source of the $500,000 personal investment funds only. An international tax attorney will be able to advise you of the tax consequences of bringing extra funds to the United States.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    In her I-526 petition to USCIS, your friend was only required to demonstrate lawful source of funds for the amount she invested under the EB-5 program (i.e., $500,000 if she invested through a regional center or $1 million if she invested directly in a business). Reporting of foreign funds is governed by U.S. tax law and she, as a permanent resident, is subject to FBAR requirements and income taxation on her worldwide income. Have her consult a tax attorney. This has nothing to do with correcting an I-526 petition.

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    Echo Meisheng King

    Immigration Attorney
    Answered on

    Your friend only needs to explain $500,000 on her I-526 application. However, after she obtains the conditional green card, her income will be subject to taxation. She needs to consult with a tax attorney who is experienced in international taxation in order to properly document her income without further complication.

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    John J Downey

    Immigration Attorney
    Answered on

    This is a question to be submitted to the IRS and not USCIS. You need to explain to the IRS why she listed the amount for the express purposes of the EB-5 application and in no way was she attempting to hide assets.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    Immigrants to the United States are subject to worldwide taxation. Hindsight is 20/20 of course, but this clearly shows the importance of obtaining tax advice before moving forward with the EB-5 process. Here, the I-526 petition is approved and, presumably, the investor is in the United States already as a conditional permanent resident. There is nothing that needs to be done to that filing, but you should call a tax attorney immediately.

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    Robert Cornish

    Securities Attorney
    Answered on

    Hopefully there was a reason why the assets were not disclosed. It sounds like she will need counsel in the United States to set up a very strong trust structure in a place like Wyoming or Nevada. One cannot totally avoid state and federal taxes, but they can be minimized if the person is willing to work with a trust company or other fiduciary. It will be difficult, however, to avoid paying tax on what was not declared. This emphasizes the need to hire U.S. tax counsel when involved in EB-5. Whoever "told" her this ought to be held to account for the taxes, in my humble opinion.

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    Jinhee Wilde

    Immigration Attorney
    Answered on

    This is not an EB-5 immigration issue. It is the income tax that she must pay once she becomes a permanent resident based on her global income. As she has such high net worth, she needs to consult with an experienced international tax accountant or an attorney.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    She needs to seek tax counsel, but can always report the money and pay taxes due. There might be penalties, but I am sure IRS will collect.

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    Ian E Scott

    Immigration Attorney
    Answered on

    One does not have anything to do with the other. You should find a tax lawyer or accountant and get them to explain tax law to your friend. The EB-5 application is only concerned with where the $500,000 came from and the applicant would not be subject to U.S. tax until they either have a green card or otherwise meet the U.S. tax residency requirements. With that kind of money your friend should hire a tax lawyer and plan accordingly.

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