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How can I convert an existing business to an EB-5 investment?

I have a successful business with two employees. I am currently working on my H-4 EAD. The business has an initial investment of $500,000 and a current revenue of more than $500,000. Can my existing capital be considered as an EB-5 investment? How can I convert this business to a direct EB-5 investment?

Answers

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    A Olusanjo Omoniyi

    Immigration Attorney
    Answered on

    Yes, you can, However, it is advisable that you should work an EB-5 attorney to put together a business plan that helps detail how the business can be operated to meet EB-5 requirements.

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    BoBi Ahn

    Immigration Attorney
    Answered on

    Yes, the capital invested may be used to file for an EB-5 immigrant investor petition as a direct investment if the business is located in a designated targeted employment area (TEA). If not, the minimum requisite capital would be $1 million and the requisite minimum job creation of at least 10 jobs must also be met, among other requirements. I am sure also you are aware that as of Nov. 21, 2019, the minimum capital investments for businesses located in TEA will be increased to $900,000 and non-TEA to $1.8 million, and the method and authority for designation of TEA will be changed. If you file prior to Nov. 21, 2019, then you would be grandfathered into the current minimum requirements.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    If you personally invested $500,000, you may be able to file if you are located in a TEA and file before November 21, 2019, when the minimum amount increases to $1.8m in a non-TEA and $900,000 in a TEA. If you can take out the money and invest it in a regional center project, this may be your best and easiest path to a green card.

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    Marko Issever

    EB-5 Broker Dealer
    Answered on

    Converting an existing business to an EB-5 investment is always challenging. No matter how elaborate an answer we give you here, you will still need professional advice. If the business was "troubled", then you could have been considered to save existing jobs by restructuring or reorganizing the company to make the investment EB-5 compliant. Your business is not troubled so you will need to expand it by increasing its net worth or number of employees by at least 40%. This will not give you 10 employees so you will need to hire an additional eight employees to have at least ten employees working in the newly expanded organization. If the company is not in a TEA designated jurisdiction then you would need to invest a total of $1 million. The earnings in your company will need to be distributed by the company as a dividend to you and then reinvested in the company as equity. You also need to perform this rather quickly before the new regulations of $900,000 (TEA) and $1.8 million (non-TEA) become effective on Nov. 21, 2019, as announced by USCIS today.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    Consult an experienced EB-5 immigration attorney to evaluate. Your EB-5 investment must come from a lawful source of funds and be traceable. Additionally, your comprehensive EB-5-compliant business plan must support the creation of at least 10 full-time positions (at least 35 hours a week). Retained earnings may not be used as EB-5 capital unless you pay out dividends or distribution to yourself, pay tax on it and then use it as EB-5 capital. Please note the minimum investment amounts will increase based on new regulations with changes to become effective Nov. 21, 2019.

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    Hassan Elkhalil

    Immigration Attorney
    Answered on

    If you are planning to apply for EB-5 based on the $500,000 investment, you may want to do so before Nov. 21, 2019. You will still need to document the source(s) of the funds, business plan, job creation, etc.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    You'd have to show how that the initial investment would result in 10 direct full-time positions.

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    Daniel A Zeft

    Immigration Attorney
    Answered on

    Your business must employ at least 10 U.S. workers within 2.5 years after your I-526 petition is filed.

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    Charles Foster

    Immigration Attorney
    Answered on

    Yes, your initial investment in your business may be considered as part of your EB-5 investment. You can file a direct EB-5 investor petition on Form I-526, but you will have to establish that you can employ 10 U.S. workers on a timely basis. Additionally, you must file your petition before Nov. 21, 2019, when the minimum investment amount will be significantly increased. You will also have to establish that the premises of your business is located in a targeted employment area (TEA) in order to qualify, based upon a $500,000 investment.

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