Questions and Answers > EB-5 Investments

How can you prove source of funds for gifts in the EB-5 program?

Some of my funds come from gifts from my mother. In my country, no rules say that we must pay taxes for this gift. How can I prove that these funds come from legal sources?

Answers

• Charles W Pley

  Immigration Attorney

  Answered on January 25, 2013

  If the ''lawful source of funds'' is a gift, the investor has to document the receipt of the gifted funds, that the funds were provided as a gift (may be in the form of an affidavit or declaration of gift by the donor, which should identify the date of the gift, amount of the gift, relationship, any special conditions, and the contact details for the donor), PLUS documents proving the donor''s legal source of those funds gifted to the investor. If there are no gift taxes in your country, it is not necessary to provide any sort of tax documentation related to your receipt of the gift. However, again, it will be critical to document the donor?s legal source of the funds that were gifted to the investor.

• Kirk A Carter

  Immigration Attorney

  Answered on January 25, 2013

  A gift letter can be used, a gift tax return is not necessary. However, the gift must be sourced with a paper trail documenting that the funds were properly obtained. Documentation must also be submitted to demonstrate the financial ability of the mother to make the gift.

• Philip H Teplen

  Immigration Attorney

  Answered on January 25, 2013

  In dealing with gifted funds, it is necessary to show that the donor obtained the funds legally by way of five years of income tax returns or other business or financial records plus a gift tax return or proof that none are required in given country.

• Amir Farzaneh

  Immigration Attorney

  Answered on January 25, 2013

  In the US the person who gives the gift files a estate and gift return. In the country where your mom is the policy may be different. Proving the source of funds depends on the specific scenarios of each case.

• Monika Sud-Devaraj

  Immigration Attorney

  Answered on January 25, 2013

  You need to prove that your mother obtained the money legally (for example, sold a property in her name), and then transferred the funds to you. She will have to include a gift letter along with the bank statements showing the transfer of funds.

• Hans Burgos

  Immigration Attorney

  Answered on January 25, 2013

  You will need to provide documentation showing your mother''s donation and prove lawful source of the funds by your mother as well.

• Lana Kurilova-Rich

  Immigration Attorney

  Answered on January 25, 2013

  Your mother would need to possibly present some documentation showing where she got that money. The money has to come from legal sources, so if she sold some property perhaps and gifted you the proceeds, the documentation showing the sale of that property could be sufficient. Essentially, the USCIS will want to know where your mother got that money that she gifted you. If she was just saving all her life and there are no bank statements going back in time (as she may have been saving cash for years), it may be difficult to prove that the source of funds is legitimate. But this is one of the challenges of EB5 program - to prove where the money came from.

• Roberto Ortiz

  Immigration Attorney

  Answered on January 25, 2013

  You will have to show your mother''s source of funds. Also, you will need to show proof of the transfers that were made by mother. If you have any additional questions, please do not hesitate to contact me.

• Jeffrey E Campion

  Immigration Attorney

  Answered on January 25, 2013

  It depends on the country that you are from. Sometimes we use the laws in that country to show that no tax is due. Venezuela has that rule. If that''s the case, we just need to show how your mom earned the money.

• Jennifer Parser

  Immigration Attorney

  Answered on January 7, 2013

  You should show how your mother obtained these funds before gifting them to you. For example, if she had real estate and sold it, you must show that transaction and the proceeds going into her account and then those funds being gifted to you into your account.

• Julia Roussinova

  Immigration Attorney

  Answered on January 7, 2013

  Gift letters or gift declarations documenting gifts made from your mother to you. If gifts were made by depositing funds into a bank account in your name, bank statements confirming transfers would be helpful. If your country does not have a gift tax regime, a letter from a tax attorney, tax authorities, or other tax professional summarizing the same will help document that no gift tax regime exists. Documentation how your mother originally acquired funds from a lawful source will also be necessary. I recommend that you contact our office to evaluate your particular situation in more detail and advise you what documents will be necessary to document the gifts and lawful source of funds for your mother.

• Bita Hamidi

  Immigration Attorney

  Answered on January 7, 2013

  You may use a gift as your source of funds, however the source of funds must still have been obtained from a legal source and documents must be provided to be able to prove the source of funds.

• Marisa Casablanca

  Immigration Attorney

  Answered on January 4, 2013

  There are several ways to prove the legal sufficiency of funds for a gift. However, each case is different. Your attorney will best be able to cater your presentation of the documents and evidence to your specific case.

• Igor Serbinin

  Immigration Attorney

  Answered on January 4, 2013

  Evidence of lawful source of funds is a complex question that depends on particular circumstances of your case. In general you have to make sure that US government understands where the money originally came from by providing wire transfer receipts, any tax returns for many years prior to investment showing income that substantiate claim that those amounts could have been gifted to you by your mother, evidence of sale of real estate or other property consistent with the amounts claimed to be gifted to you. The fact that gifts are not taxable in your country does not relieve you from showing other taxable events that could have been associated with such significant amounts required by EB5 program.

• Jason Feldman

  Immigration Attorney

  Answered on January 4, 2013

  To prove the source of funds for a gift, one will need to go through the same steps to show that the donor lawfully earned the money (which includes supplying their tax returns, bank statements, business licenses etc.).

• Daniel A Zeft

  Immigration Attorney

  Answered on January 4, 2013

  The funds of the EB-5 investor can come from a gift. The gift must be made in accordance with the laws of the foreign country. Documentation from a relevant expert could be included with the I-526 petition to establish that the gift was made in accordance with the law of the foreign country.

• Taher Kameli

  Immigration Attorney

  Answered on January 4, 2013

  A legal letter based on your countries rules and regulations.

• Charles H Kuck

  Immigration Attorney

  Answered on January 4, 2013

  A simple letter confirming the gift is typically sufficient, along with proof of your mother acquisition of the funds.

• Laura Danielson

  Immigration Attorney

  Answered on January 4, 2013

  The mother''s source of funds must also be proven to show that the gift she made came from a lawful source. This is the same procedure as proving the source of funds for the principal investor.

• Alice H Sun

  Immigration Attorney

  Answered on January 4, 2013

  Yes, we will help our clients to prepare lawful source documentation for a gift.

• Mona Shah

  Immigration Attorney

  Answered on January 4, 2013

  An affidavit from the donor will suffice. Please note that your mother''s source of funds will be questioned.

• Larry J Behar, Esq

  Immigration Attorney

  Answered on January 4, 2013

  The gift solution for EB 5 can be demonstrated by an Affidavit by the donor and an acceptance from the donee. Note however that the donor may have to prove the source of funds of the gift or an explanation thereof. While tax payments are an excellent source of such demonstration, there are many other reasons why the donor may have had such funds available and a solid explanation along with supporting documents can be used.

• Olga Karasik

  Immigration Attorney

  Answered on January 4, 2013

  Yes, you can use funds gifted by your mother. Your mother will have to provide evidence of the source of funds.

• Edward Litwin

  Immigration Attorney

  Answered on January 4, 2013

  The answer really depends on the circumstances and the documentation that may be normal to the country. By your question, I can see that you realize the difficulty in proving the source of funds. Affidavits, bank records, etc. may be useful. I suggest that you call my office to arrange an appointment to discuss this in more detail.

• Jinhee Wilde

  Immigration Attorney

  Answered on January 4, 2013

  We will need to track how she obtained the money in the first place, perhaps income tax returns from her or sale of property she made, etc. Then, we need to document the sum she gave you going into your account on that certain date via copy of your bank statements from before and after the deposit along with the gift letter from her stating when and how much she gave you.

• Stephen Berman

  Immigration Attorney

  Answered on January 4, 2013

  Show you paid taxes for it.

• David Hirson

  Immigration Attorney

  Answered on January 4, 2013

  To prove source of funds from a gift: a. Have a written document recording the terms of the gift: Names of giftor and recipient of the gift. Amount of the gift. (Add a conversion in US dollars if the gift is in another currency). Date and place of the gift. Signature of the gift document. b. Written confirmation that the gift is not subject to gift tax in the country where the gift was made. A letter from qualified professional or the tax authorities of the country are appropriate. c. Detailed documents to prove the source of the funds being given to the recipient of the gift. The documents and information including tax returns are the same as those required from the investor if the funds came directly from the investor. d. The investor should provide the last 5 years of tax returns, if available. Students in the US may not have income and therefore do not have tax returns.

• Neville M Leslie

  Immigration Attorney

  Answered on January 4, 2013

  Bank statements, mortgages, wills, trusts, or the like.

• Reza Rahbaran

  Immigration Attorney

  Answered on January 3, 2013

  You are able to use gifted funds for your EB-5 investment. The person gifting the funds must make an irrevocable gift to the recipient with ‘no strings attached’. This should be evidenced by an affidavit. To prove the lawful source of the gifted funds you would follow the same procedure for evidencing the lawful source of your funds. For further information please contact Rahbaran & Associates, 202.338.3333 and a m ember of staff will be pleased to answer any questions regarding the EB-5 program.