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EB-5 Investment – New Regulations Expected To Increase Minimum Investment of $500,000 To $1.35 Million

EB-5 Investment – New Regulations Expected To Increase Minimum Investment of $500,000 To $1.35 Million

On June 27, 2019 the Office of Management & Budget (OMB) reported on its website that it has finished its review of the Obama-era regulations that would significant changes to the minimum investment amount, as well as other consequential changes.

 
The regulations have proposed increasing the minimum investment of $500,000 to $1.35 million, and the $1 million investment to $1.8 million. Upon the regulation’s publishing in the Federal Register, the final effective date may be between 30 to 60 days.  

It is recommended that potential investors seeking an EB-5 visa start immediately to organize their documentation proving their lawful source of funds. They then must select their investment projects in order to file their I-526 petition before the effective date of the new regulations. Similarly, projects seeking EB-5 investors will need to ensure that their investors have filed their petitions prior to the deadline
 
Alternatively, potential investors seeking an EB-5 should also consider an E-2 investor visa. They are an appealing options for foreign business persons, investors, managers, and employees who wish to stay in the United States for extended periods of time to oversee:
  1. an enterprise that is engaged in trade between the United States and a foreign country; or 
  2. a major investment in the United States.

The E visa isn’t for just anyone who has a trade or investment. This visa class is exclusively for what the USCIS terms “treaty traders and investors”. This means that all applicants must be nationals of a country that holds a treaty of trade and commerce with the United States.

 
If you’re wondering if your country is a treaty country, you can look for it on the comprehensive list provided by the Department of State.
 
The regulations state that you must be a national of one of these countries, but you do not necessarily need to be currently living there. 
 

Treaty Investor (E-2) Visa

Treaty investor applicants must meet specific requirements to qualify for a treaty investor (E-2) visa under immigration law. The consular officer will determine whether a treaty investor applicant qualifies for a visa.

  • The investor, either a real or corporate person, must be a national of a treaty country.
  • The investment must be substantial. (Usually $100,000 in a corporate bank account) It must be sufficient to ensure the successful operation of the enterprise. The percentage of investment for a low-cost business enterprise must be higher than the percentage of investment in a high-cost enterprise.
  • The investment must be a real operating enterprise. Speculative or idle investment does not qualify. Uncommitted funds in a bank account or similar security are not considered an investment.
  • The investment may not be marginal. It must generate significantly more income than just to provide a living to the investor and family, or it must have a significant economic impact in the U.S.
  • The investor must have control of the funds, and the investment must be at risk in the commercial sense. Loans secured with the assets of the investment enterprise are not allowed.
  • The investor must be coming to the U.S. to develop and direct the enterprise. If the applicant is not the principal investor, he or she must be employed in a supervisory, executive, or highly specialized skill capacity. Ordinary skilled and unskilled workers do not qualify. 
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Contact the Tax Lawyers at
Marini & Associates, P.A. 
 
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www.TaxAid.com or www.OVDPLaw.com
or Toll Free at 888-8TaxAid (888 882-9243). 

Read more at: Tax Times blog

 
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