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What are the employment restrictions for an EB-5 investor in a direct business?

Can an EB-5 investor be employed for compensation at the business in which they invest? If this is possible, are there salary restrictions? Will this employment affect job creation requirements?

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    Elana Laverty

    Immigration Attorney
    Answered on

    In order to be eligible to be employed in the United States, you will need proper work authorization. Once you have proper work authorization, there are no restrictions in the amount of salary you receive as an employee. Please note that your position will not count as a one of the ten required jobs needed under the program''s job creation requirement.

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    Steffanie J Lewis

    Immigration Attorney
    Answered on

    An investor may be employed by the business enterprise in which he or she invested, but neither the jobs held by the investor nor family members may be included when proving the 10 full-time position created by the investment. Each EB-5 investment, $1,000,000 or $500,000 if the investment is in a targeted employment area (TEA - targeted because there is high unemployment in the area) must create 10 full-time jobs. Prior to the second anniversary of the investor''s having entered the United States as a conditional U.S. lawful permanent resident, the investor must file with the U.S. Citizenship and Immigration Service to remove the condition. In that application, the investor must show that his or her EB-5 investment created 10 full-time jobs. This may be shown, for example, by attaching the W-2 or I-9 forms from ten full-time employees. Neither the investor nor any family member may be included as an employee for the purpose of meeting the ten-employee requirement. Otherwise, and depending upon the organizational structure of the business enterprise, certain state and federal employment reports and requirements apply equally to the investor as to other employees. There is no legal or regulatory salary restriction except that the enterprise must have sufficient revenue to create 10 full-time jobs in additional to those held by the investor and family.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    The EB-5 investor''s employment will not count as one of the 10 required jobs for EB-5 job creation purposes. The investor will be required to have an active management role either way.

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    Louis M Piscopo

    Immigration Attorney
    Answered on

    Once you have been issued an Employment Authorization Document (if you filed for adjustment of status), or once you enter on your immigrant visa (if you consular processed) you can be employed by the business. There are no salary restrictions. However, you are not counted as one of the 10 jobs that must be created.

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    An EB-5 investor with proper work authorization (after he or she receives a conditional green card) may work in the new commercial enterprise. There are no salary restrictions. The investor''s own employment position does NOT count for purposes of meeting the job creation requirement. This is true for the investor''s immediately family members as well.

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    Kenneth C Wright

    Securities Attorney
    Answered on

    In a direct (non-regional Ccenter affiliated) business investment, the required amount of investor funds must be used to: *Create or preserve at least 10 full-time jobs for qualifying U.S. workers within two years (or under certain circumstances, within a reasonable time after the two-year period) of the immigrant investor''s admission to the United States as a conditional permanent resident. *Direct jobs are actual identifiable jobs for qualified employees located within the commercial (non-charitable) enterprise into which the EB-5 investor has directly invested his or her capital (or any wholly owned subsidiary of such enterprise). According to USCIS: A qualified employee is a U.S. citizen, permanent resident or other immigrant authorized to work in the United States. The individual may be a conditional resident, an asylee, a refugee, or a person residing in the United States under suspension of deportation. This definition does not include the immigrant investor; his or her spouse, sons, or daughters; or any foreign national in any nonimmigrant status (such as an H-1B visa holder) or who is not authorized to work in the United States. Full-time employment means employment of a qualifying employee by the new commercial enterprise in a position that requires a minimum of 35 working hours per week. In the case of the Immigrant Investor Pilot Program, "full-time employment" also means employment of a qualifying employee in a position that has been created indirectly from investments associated with the Pilot Program. Once the immigrant investor is admitted to the United States as a conditional permanent resident, he or she may be employed in the United States. This can include employment by the investee business. However, none of the investor or any of the persons described in the language underlined above will count towards the job creation requirements or the EB-5 program. In general, there are no specific salary restrictions. For example, an immigrant investor who owned 100 percent of the business and caused herself to be employed by it would not be subject to specific caps on her salary. However, prudence would suggest that the salary be reasonable in light of the services provided, since in all cases she would need to show that her original required investment amount remained at risk until removal of the conditions on her permanent residency. Likewise, if the investor owned less than 100 percent of the business or a minority interest, then salary to the investor would need to be fair or reasonable under the circumstances under state legal principles. Similarly, care would need to be taken for EB-5 purposes to establish that the required investment amount remained at risk until removal of the conditions and that the salary was not a veiled return of capital. In circumstances where it is not easy to make the case that the salary and capital are separate, you might decide to not take a salary in order to avoid a possible complication in removal of your conditions. You would want to discuss the facts and circumstances up front with your immigration counsel, in order help you make these decisions.

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    Oliver Huiyue Qiu

    Immigration Attorney
    Answered on

    An EB-5 investor must be involved in the enterprise by either exercising managerial control of the day-to-day operations or through policy formulation. An investor must be "actively involved in the business;" a purely passive investor may not qualify for the EB-5 classification. The EB-5 investor could either draw a salary or receive dividends from the enterprise. There is no salary restriction such as the minimum wage. The employment of the EB-5 investor, be it full time or part time, is not counted towards the required job creation.

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    Ian E Scott

    Immigration Attorney
    Answered on

    An investor can be employed at the business he/she creates, but must create 10 additional full-time qualifying jobs. Generally speaking, salaries are governed by labor laws (eg. minimum wage), but an owner would have a significant amount of flexibility regarding their compensation.

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