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Questions and Answers > EB-5 Investments

How can I channel EB-5 funds through a holding company?

I have structured a holding company that will fully own its subsidiaries. I will fund the holding company with the required funds for EB-5 investment. Can the holding company directly invest funds on behalf of the subsidiary, or do these funds need to be transferred to the subsidiary account and spent from there?

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Answers

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    Only if it is a 100% wholly owned subsidiary. Still best to use individual, not corporate accounts.

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    Benjamin Hu

    Immigration Attorney
    Answered on

    In a standalone EB-5 project, the required qualifying job positions should be created by the New Commercial Enterprise (the entity which receives the EB-5 investment funds from the petitioner), and/or its 100% fully owned subsidiaries. It is permissible for the jobs to be spread across multiple entities provided that they comply with the EB-5 rules. Also, standalone EB-5 petitions must rigorously account for each actual job created, and may not rely on abstract econometrics (unlike Regional Center jobs). It can be possible for the parent entity to create some jobs, and for the subsidiaries to create others, but each entity would need to maintain detailed payroll documentation to prove that the 10 full time positions were actually created and maintained. Because EB-5 petitions are complex, it is advisable to consult with an experienced attorney before moving ahead with any financial or immigration plans.

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    Dennis Tristani

    Immigration Attorney
    Answered on

    Either strategy works - so long as the subsidiaries are wholly (100% owned) by the holding company, either company can use the investment funds towards the project and furtherance of the business plan. Either company can also employ the 10+ employees.

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    Belma Demirovic Chinchoy

    Immigration Attorney
    Answered on

    The holding needs to invest funds into the job creating entity(ies).

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    Lynne Feldman

    Immigration Attorney
    Answered on

    May be OK - would need more details. Must be able to show the funds are lawfully sourced tracing from you to the final investment.