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What prospective investors should know about the EB-5 visa program - III

In today's post, we'll conclude our ongoing discussion of the EB-5 visa program, the sometimes controversial initiative designed to grant permanent residence to those immigrant entrepreneurs who 1) make a capital investment in a new U.S.-based commercial enterprise, and 2) either preserve or create ten permanent jobs for qualifying U.S. workers within two years of their admission.

In our last post on this subject, we discussed the job creation requirements of the EB-5 visa program, and in today's post, we'll discuss the capital investment requirements.

Capital investment requirements under the EB-5 visa program

While a person would naturally think the requirement for a capital investment means only cash would suffice, the EB-5 visa program actually permits other forms of investment, including inventory, equipment, tangible property and/or cash equivalents.

Indeed, indebtedness secured by assets owned by the immigrant entrepreneur can also be counted so long as 1) he or she is primarily and personally liable for the debt, and 2) the assets of the new U.S.-based commercial enterprise are not used to secure this debt.

As to the important issue of how exactly how much capital is required, the rules dictate that the minimum qualifying investment in the commercial enterprise is $1 million. However, if the commercial enterprise is located in a "targeted employment area," the minimum qualifying investment drops to $500,000.

A targeted employment area includes either of the following:

  • A high-unemployment area: An area enduring an unemployment rate of at least 150 percent of the national average rate at the time of investment
  • A rural area: An area designated by the U.S. Office of Management and Budget as being outside of a metropolitan statistical area, or outside the boundary of any city/town with a population of 20,000 or more as measured by the Census.

Another few important points to keep in mind concerning the capital investment requirement include:

  • The value of all capital will be assessed at fair-market value in U.S. dollars
  • Capital acquired through unlawful means, either directly or indirectly, will not be considered.

Those with questions or concerns about the complex process of securing permanent residence via the EB-5 visa petition should give very serious consideration to speaking with a skilled legal professional who can guide them through the entire process.

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