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What are the tax consequences of opening a U.S. bank account for a prospective EB-5 investor?

I am planning to invest in the EB-5 program. I would like to open a debit account in the U.S. for funds transfer purposes. Could I have any tax liabilities because of this?

Answers

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    Opening a bank account on its own is not likely to make applicant a U.S. tax resident. Together with several other factors, like owning a home and, most important, spending a substantial period of time here, could be relevant.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    Bank accounts of non-resident owners are subject to U.S. tax withholding on interest the funds in the account may generate. If you open a debit account, it will unlikely have a significant interest rate and if you transfer the funds out into a project you plan to invest to relatively soon, you will not likely have any significant tax liability. You may also want to transfer the funds directly from your foreign personal bank account in your name to the project's trust account. Please hire an experienced EB-5 immigration attorney who will guide you through the process and competently prepare your I-526 petition.

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    Hassan Elkhalil

    Immigration Attorney
    Answered on

    You are better served if you consult with a tax advisor or CPA.

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    Barbara Suri

    Immigration Attorney
    Answered on

    You could be required to pay income taxes on interest earned on your funds.

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    A Olusanjo Omoniyi

    Immigration Attorney
    Answered on

    Not until you started to live in the U.S., even though. The interest earned on the deposits will be reported to the IRS. The general rule is, unless an investor (depositor) is in the U.S., the interests may be simply reported to the IRS without being liable for any tax.

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    Sally Amirghahari

    Immigration Attorney
    Answered on

    If you are in the U.S. physically, I suggest going to the bank of your choice and discussing this with your bank, since the type of account and length of time that your funds will be held in the account may have tax implications. However, in general, there is no tax consequence on the base of the fund. But, for example, if your money earns interest while it is being held in the bank account, then you may have to pay income tax. The tax rate is generally determined by your status in the U.S., your assets and income as well as a tax treaty. You may want to talk to a tax attorney so you can plan accordingly.

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    You should check with a tax expert, but in general, simply opening a U.S. bank account, by itself, will not trigger any tax liabilities. The bank may send you a 1099-INT if you accrue interest in your account. Whether this income is actually taxable and whether you need to file a U.S. tax return is a matter for a tax expert.

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    Stephen Berman

    Immigration Attorney
    Answered on

    You should speak with an accountant about tax consequences.

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    Lynne Feldman

    Immigration Attorney
    Answered on

    There are reporting requirements, not necessarily any tax consequences, for transfers in excess of $10,000. Check with the bank and they can advise you.

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    Marko Issever

    EB-5 Broker Dealer
    Answered on

    Once you earn money in U.S. soil you will be subject to U.S. taxes, independent of you filing for EB-5 or not. Therefore, once you open an account in a U.S. bank, if the U.S. bank pays you interest on those funds, you will need to pay taxes on the interest earned unless it could be proven that your total U.S.-based earnings is de minimis. Once you become a conditional green card holder, however, you would then be subject to global taxation. If the purpose of the U.S. bank account is strictly for funds transfer purposes and you intend to keep no funds there after the EB-5 investment is made, then you should not be creating any tax liabilities. Bear in mind, though, although quite small, most EB-5 investments pay current income. This current income will be subject to taxes no matter which bank receives the funds in the U.S. or overseas, because the payer of the interest is by definition a U.S. company.

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    Dale Schwartz

    Immigration Attorney
    Answered on

    There are no tax consequences in merely opening a U.S. bank account. Many of our clients send their EB-5 investment funds to our law firm's escrow account at Wells Fargo, and we forward the funds to the EB-5 project. We have successfully done many hundreds of these cases.

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    BoBi Ahn

    Immigration Attorney
    Answered on

    This may be better addressed by an accountant, but mere opening of a bank account would not alter tax liabilities if you are maintaining non-resident alien status and are not present in the U.S. more than 180 days a year. Upon becoming a lawful permanent resident, however, when your EB-5 is fully processed, you would be subject to U.S. taxation.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    Possibly! I always recommend that my clients speak with a CPA or tax attorney with experience with international clients. Pre-immigration tax planning is very important.

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