Updated EB-5 Frequently Asked Questions (and Answers) brought to you by Carolyn Lee PLLC.
Introduction: The October 2020 Visa Bulletin brought important new information to the EB-5 Community regarding the EB-5 visa backlog and visa availability for the rest of Fiscal Year 2021 and beyond. This Updated CLP FAQ reflects insights from the October 2020 Visa Bulletin, particularly of interest to Indian EB-5 investors. For more in-depth analysis of the October 2020 Visa Bulletin, see Carolyn Lee’s joint analysis with IIUSA at https://carolynleepllc.com/2020/09/29/carolyn-lee-and-iiusa-jointly-analyze-the-october-2020-visa-bulletin/
What is an EB-5 visa?
An EB-5 visa is a U.S. immigrant (meaning U.S. permanent residency) visa. Another name for an “immigrant visa” is a “green card.” There are different green card categories, based primarily on family-based relationships or employment-based sponsorships. An EB-5 visa is in the employment-based side, and it’s based on investment and U.S. job creation.
Who applies for an EB-5 visa, or who is the primary EB-5 visa applicant?
An EB-5 petitioner is an individual investor. Spouses and children under 21 are also included, as long as children remain under 21 until a visa is available.
What are the basic requirements for an EB-5 visa?
Each investor must invest $1.8 million or $900,000 (if investing in a Targeted Employment Area) and create 10 U.S. jobs for qualifying employees. The EB-5 visa is conditional and temporary. At the end of a 2-year conditional period, the investor must show that the investment was maintained and at least 10 jobs were created.
What is the EB-5 regional center program?
The EB-5 regional center program was created in 1993 to allow multiple investors to pool their capital for enhanced economic impact within a defined geographic area. The regional center program is not yet a permanent part of U.S. immigration laws, and so must be reauthorized from time to time.
What is the difference between investment through the EB-5 regional center program and the non-regional center program?
The main difference is how job creation is shown. In the basic EB-5 program, the 10 U.S. jobs must be direct hires of the enterprise into which the EB-5 investor contributes capital. In the regional center EB-5 program, the 10 U.S. jobs can be direct or indirect. This means that the jobs can be created by entities receiving and using the EB-5 capital proceeds, not just the direct hires. Generally accepted job creation methodologies are typically used to measure indirect job creation.
How are job creation methodologies used to show job creation in the regional center program?
Indirect job creation can be established by reasonable methodologies. Reasonable methodologies typically accepted by USCIS include input-output models used by the U.S. government and other public and private entities around the world. These input-output models mathematically estimate the job creation and other economic impact of a particular stimulus to the economy, such as capital investment.
Can EB-5 investors receive their capital back?
The goal of any economic investment is to grow the original investment. This means that the rational hope behind any investment, including an EB-5 investment, is for a gain on the principal invested. However, the EB-5 investment cannot be accompanied by any kind of promise that the investor will actually receive a return of principal or any gain on the principal. This is essentially what it means for EB-5 investment to be required to be an “at risk” investment.
How long is the EB-5 visa process?
The EB-5 process timing depends on a number of moving variables. These variables include investor preparation for filing, USCIS processing times after filing, visa wait times after approval, time for investor and family members to enter the U.S., and USCIS processing times for petitions to remove conditions.
What is the EB-5 visa backlog?
The U.S. immigration system is quota-based, meaning there are generally limits on how many visas may be allocated in a year. There are approximately 10,000 visas available a year in the EB-5 category. Whenever demand by visa applicants exceeds the supply of visas, there is a backlog. While there have been long-standing backlogs in other green card categories, the backlog in the EB-5 category is relatively recent, having onset in mid-2015. Currently, there is a visa backlog for nationals from China and Vietnam.
A visa backlog for Indian nationals onset for the first time in July 2019 with a cut-off date of May 1, 2017. However, after 1 year of erratic priority date movements, EB-5 became current for India in July 2020 and is expected to remain current.
What is the impact of the EB-5 visa backlog?
Visa backlogs mean that investors must wait to obtain their EB-5 visas after I-526 petition approval. The duration of the wait is determined broadly speaking by how many visa applicants are ahead of a particular investor in the visa queue. Because children keep aging until the parent-investor’s place in the queue is reached, in-depth discussion with immigration advisors is essential to informed decision-making and planning before investment.
These FAQs are copyrighted by Carolyn Lee PLLC. Disclaimer: These FAQs do not constitute legal advice. Receiving this material in any form does not create an attorney-client relationship. Only an engagement letter signed by attorney and client creates an attorney-client relationship. Any time frames mentioned are estimates based on many fluid variables. Contact Carolyn Lee PLLC or e-mail email@example.com.