Questions and Answers > EB-5 Requirements

What are job creation requirements in EB-5 projects involving expanding businesses?

If you invest in a project that purchases and then expands an existing business by more than 40%, can you count the business''s existing jobs to meet the job creation requirement?

Answers

• Bernard P Wolfsdorf

  Immigration Attorney

  Answered on November 3, 2013

  Need to create new jobs unless it is a troubled business.

• Shahzad Q Qadri

  RC Creator

  Answered on March 8, 2013

  10 per investor, the same standard applies.

• Roberto Ortiz

  Immigration Attorney

  Answered on March 8, 2013

  If you invest in an existing business, you must demonstrate that you will increase by 40% either the net worth or the number of employees. If you have any questions, please do not hesitate to contact me. Thank you.

• Reza Rahbaran

  Immigration Attorney

  Answered on March 7, 2013

  You may only count pre-existing jobs if the business falls under the definition of a ''troubled business''; the benchmark being; - A business that has been in existence for at least two years, AND - Incurred a net loss during the 12- or 24-month period prior to the priority date on the immigrant investor''s Form I-526, AND - The loss for this period must be at least 20 percent of the troubled business'' net worth prior to the loss. For further information please contact Rahbaran & Associates.

• Jinhee Wilde

  Immigration Attorney

  Answered on March 7, 2013

  The investment must result in at least 40% increase either in the net worth or the number of employees of the business. For example, if a business has a $2 million net worth and employs 30 people, the investment would qualify either if it increases net worth by at least $800,000 or if it results in an expansion of 12 more employees.

• Mahsa Aliaskari

  Immigration Attorney

  Answered on March 7, 2013

  Existing jobs may be counted only when the business also qualifies as troubled business for EB-5 purposes. In the case of expanding an existing business, the expansion needs to result in a 40% or more increase in the net worth of the business or the number of employees. In some cases this may mean creating more than 10 new full time positions, it is important to consult with an EB-5 practitioner prior to making the investment.

• Ying Lu

  Immigration Attorney

  Answered on March 7, 2013

  The ''existing business'' in EB-5 context is different from what we usually think. In EB-5 context, only business established on or before Nov. 29, 1990 is an ''existing business''. Then, you need either restructure or expand the business to make it a ''new commercial enterprise'' which is required by the law. As to the job creation requirement, investors may only be credited with preserving jobs in a troubled business. A troubled business is an enterprise that has been in existence for at least two years and has incurred a net loss during the 12- or 24-month period prior to the priority date on the immigrant investor''s Form I-526. The loss for this period must be at least 20 percent of the troubled business'' net worth prior to the loss. Other than that, 10 new jobs must be created for each EB-5 investor.

• BoBi Ahn

  Immigration Attorney

  Answered on March 7, 2013

  One of the requirements under the EB-5 Immigrant Investors is that the money be invested in a ?new commercial enterprise? ? and this is defined as: 1) original business; 2) buy and reorganize existing company; or 3) invest in an existing business consisting of >40% increase in net worth or >40% increase in # of employees (or both), so that the new net worth or number of employees (or both) amounts to at least 140% of the business? pre-expansion/Investment net worth/# of employees. So in answer to your question, you need to either increase the business?s net worth or the # of employees by 40% in order to meet this requirement. Additionally, where the investment only sustains current employees but does not create new full time jobs, it does not meet the jobs requirement unless the investment is in a ?troubled business? (net loss for 1 or 2 years exceeding 20% of net worth). Hope the information is helpful.

• Lei Jiang

  Immigration Attorney

  Answered on March 7, 2013

  It''s the same. For every $500,000 (or 1 million) investment fund, 10 full time jobs are created. You cannot count the existing jobs. Best.

• Julia Roussinova

  Immigration Attorney

  Answered on March 6, 2013

  You can count the preexisting jobs only if the investment is made in a "troubled business." If the investment is made in a preexisting for-profit enterprise to be expanded, the expansion must result in an increase of at least 40% in the net worth of the business or in the number of employees of the business. The latter could require an EB-5 investor to create more than 10 new full-time jobs to qualify under a direct EB-5 case. You should consult an immigration attorney to review and analyze your specific situation before investing. Do not hesitate to contact our office should you have further questions.

• Boyd Campbell

  Immigration Attorney

  Answered on March 6, 2013

  No, you would not be able to count the business''s existing job to meet the creation requirements.

• Fredrick W Voigtmann

  Immigration Attorney

  Answered on March 6, 2013

  You can count the existing jobs only if the commercial enterprise also qualifies as a troubled business. Otherwise, the requirement is that the investment must create ten new jobs.

• Steven Anapoell

  Securities Attorney

  Answered on March 6, 2013

  You may not count existing jobs.

• Ed Beshara

  Immigration Attorney

  Answered on March 6, 2013

  The facts of each case will require an analysis and hence job creation requirements have to be EB-5 compliant.

• Mona Shah

  Immigration Attorney

  Answered on March 6, 2013

  Under the EB-5 program, each investment must create a minimum of ten full time positions for qualified U.S. workers. However, it should be noted than if an investor invests in a new enterprise (based on the expansion of an existing business) then that expansion must result in an increase of least 40 percent in the new worth of the business or in the number of employees of the business. Therefore, the investment could actually require the creation of more than ten new jobs to qualify if the pre-expansion number of employees of the business was more than 25.

• Clem Turner

  Securities Attorney

  Answered on March 6, 2013

  Unfortunately you cannot count existing jobs towards the Job Creation requirement, unless the business is a "troubled business," in which case you can count jobs saved.

• Stephen Berman

  Immigration Attorney

  Answered on March 6, 2013

  No.

• Susan Pilcher

  Immigration Attorney

  Answered on March 6, 2013

  The only time you can "count" preexisting jobs toward the 10-jobs-per-investor requirement is if the enterprise qualifies as a "troubled business." Please let us know if we can help further.