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What is the minimum job requirement for an EB-5 investment in a failing business?

My Israeli friend, who has a Romanian wife and three small children, would like to relocate to the U.S. from Romania and is considering the EB-5 program. He has a BS in Business Administration from a U.S. university and was the CFO of two major casinos for eight years, one of which he was also the CEO. He is a consultant in Europe at the moment. He has no U.S. employer and would prefer to start or buy a business. If he decides to save a failing business as an investment option, I understand there is no 10 full-time employee requirement, only that the business maintain the same number of employees as before, is that accurate? What if the business only had one employee and it saw losses of 20 percent over the last two years? What documentation is needed to prove that a business is failing?

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    For a troubled business, 10 jobs must be preserved, created, or some combination of the two (e.g., an investment in a troubled business that creates four qualifying jobs and preserves all six pre-investment jobs would satisfy the statutory and regulatory requirements). Showing a business is troubled requires showing a net loss for a certain period of time that is equal to a certain percentage of the net worth prior to that loss

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    Jinhee Wilde

    Immigration Attorney
    Answered on

    Actually, when buying a failing business, you have to document that you have saved at least 10 jobs that otherwise would have been lost. Thus, the job creation requirement is changed to preserving rather than creating, but the jobs requirement for EB-5 remains. Also, when you are doing an EB-5 case with a failing business, there are other requirements you need to meet for such case.

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    Ed Beshara

    Immigration Attorney
    Answered on

    The first step is to retain the services of an experienced EB-5 attorney and economist. These professionals will review and analyze the troubled business and determine the legal requirements for maintaining the required employment creation. The basics show that 10 jobs either have to be created or maintained per investor. The required job creation analysis can either be based upon a direct EB-5 investment or an EB-5 regional center investment.

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    The number of full-time jobs saved or maintained must be at least 10. Net loss or losses equal to at least 20 percent of net worth would be demonstrated by tax returns and financial statements for the prior two years.

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    BoBi Ahn

    Immigration Attorney
    Answered on

    EB-5 immigrant investor petitions, the commercial enterprise must benefit the U.S. economy and must create full-time employment for not less than 10 U.S. employees. Exceptions to this rule are made only for investment in "troubled businesses" defined as businesses that have been in existence for at least two years and have incurred a net loss of at least 20 percent of their net worth. Such investments do not have to create 10 new jobs, but the investor must show that the number of existing employees is or will be maintained at no less than the pre-investment level for a period of at least two years.

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