General EB-5 Visa Information

The EB-5 program for immigrant investors was created by the Immigration Act of 1990. This visa is an effective tool for foreign investors who want permanent residence for themselves and their families in the United States.

In order to obtain permanent residence, the investor must invest $1,000,000 (or $500,000, if the business is located in a Targeted Employment Area). The investor has to create 10 full-time jobs for qualified U.S. workers. In counting the 10 workers, the investor cannot include themselves or their immediate family.

If the foreign national investor’s petition is approved, the investor and their dependents will be granted conditional permanent residence valid for two years. Within the 90 day period before the conditional permanent residence expires, the investor must submit evidence documenting that the full required investment has been made and that 10 jobs have been maintained, or 10 jobs have been created or will be created within a reasonable time period.

In 1992, Congress created a temporary pilot program designed to stimulate economic activity and job growth, while allowing eligible aliens the opportunity to become lawful permanent residents. Under this pilot program, foreign nationals may invest in a pre-approved regional center. A regional center is defined as an “economic unit, public or private, which is involved with the promotion of economic growth, including increased export sales, improved regional productivity, job creation, or increased domestic capital investment”. The biggest advance of investing in a regional center is that the regional center is allowed to count jobs created both directly and indirectly for purposes of meeting 10 job creation requirement.

Investing in a New Commercial Enterprise

A new commercial enterprise is a business entity that was created after November 29, 1990.

The EB5 process is commenced when the investor files a petition, Form I-526, with the USCIS (US Citizenship and Immigration Services). The petition and supporting documentation must demonstrate EB5 eligibility according to the requirements indicated below.

There are four general steps that investors must complete to become U.S. permanent residents through the EB-5 visa program. Once these steps have been completed, EB-5 investors, their spouse, and their unmarried children under the age of 21 become U.S. permanent residents. They will even have the option to become full U.S. citizens 5 years after obtaining their permanent residency.

Step 1: Locating an EB-5 Project

The preliminary step is for the EB-5 applicant to find a suitable business project to receive their investment. EB-5 business projects generally take the form of either new commercial enterprises or Regional Center projects.  Applicants must also ensure that they meet accredited investor income requirements in order to move forward with the EB-5 process.

Step 2: Capital Investment and I-526 Petition

The second step of the EB-5 visa process is for the applicant to make the required capital investment amount in the project that they have chosen. This typically involves the assistance of an accountant to ensure that the $500,000 or $1 million amount has either been invested or is in the process of being invested in their EB-5 project. These investments are often made into an escrow account. Then an immigration attorney provides proof of this investment by filing an I-526 petition with the USCIS. The USCIS typically informs applicants whether or not their I-526 petition has been accepted after 4 to 6 months.

Step 3: Two Year Conditional Permanent Residency

The third step of the EB-5 application process is for the applicant to become a two year conditional resident of the United States so they can put their EB-5 project investment to work. EB-5 investors are eligible to become U.S. residents once their I-526 petition has been approved by the USCIS. Residency can be attained in one of two ways. If the EB-5 investor already has lawful status in the US, then they must file form I-485 to adjust their status to conditional permanent resident. If the investor does not already have U.S. status, then they must file for an immigrant visa by submitting form DS-230 to the National Visa Center and must process through the U.S. consulate or embassy in their home country. Both of these steps typically require the help of an immigration attorney and the immigrant visa is issued on average in 6 to 12 months.

Step 4: Unconditional Permanent Residency and the I-829 Petition

The last step in the EB-5 visa process is for applicants to become unconditional permanent residents by removing their two-year conditional status. The I-829 petition is submitted to the USCIS 90 days prior to the anniversary of the date that the applicant first received their conditional residency. This application proves that the investor has met all requirements of the EB-5 visa program. The USCIS most often issues a permanent green card 6 to 8 months after the I-829 has been submitted. The investor, their spouse, and their unmarried children under the age of 21 can then permanently live and work in the United States and have the option to become U.S. citizens after a 5 year period from the date they received their initial conditional residency.

Eligibility Requirements for EB5Invest in a New Commercial Enterprise

The law requires the investor-petitioner to invest in a new commercial enterprise. The enterprise must be “new,” i.e., started after November 29, 1990, the date the law was enacted. However, an investor’s contribution of capital to an existing business that was formed prior to November 29, 1990 may be acceptable in cases of substantial restructuring or expansion.

The investment must be in a “commercial” enterprise. Any for-profit entity formed for the ongoing conduct of lawful business may serve as a commercial enterprise. This includes sole proprietorships, partnerships, holding companies, joint ventures, corporations, business trusts, or other entities publicly or privately owned. This definition includes a holding company and its wholly-owned subsidiaries, if each subsidiary is engaged in a for-profit activity formed for the ongoing conduct of a lawful business. However, the term “new commercial enterprise” does not include noncommercial activity such as owning a personal residence.

Engage in a New Commercial Enterprise

The law requires the investor to engage in a new commercial enterprise. A passive investor cannot qualify for permanent residence in this visa category. The investor must be involved either in the day-to-day managerial control of the commercial enterprise, or in the management of the enterprise through policy formulation. The USCIS regulations state that if the investor is a corporate officer or board member, or, in the case of a limited partnership, is a limited partner with the rights and responsibilities typically provided under the provisions of the Uniform Limited Partnership Act, then the investor satisfies the requirement of engaging in the management of the new commercial enterprise. The USCIS has stated that the investor must actually engage in management rather than just carry the title.

Investment of Capital

The law requires an investor-petitioner to have invested or be in the process of investing the required capital. This requirement has several elements that require separate consideration.

Amount of Capital

First, the amount of required capital is a minimum $1 million. The minimum amount is reduced to $500,000 in cases of investment in “targeted employment areas,” which are either rural areas or areas which experience unemployment of at least 150 percent of the national average rate. A “rural area” is an area not within either a metropolitan statistical area or the outer boundary of any city or town having a population of 20,000 or more. The assessment of whether the investment is in a targeted employment area is based on statistical information relating to the time of investment, and is based on the location where the enterprise is principally doing business.

Equity Capital

Next, to “invest” is to contribute equity capital to the enterprise. Loans of capital by the investor to the enterprise do not count. The investor cannot receive any bond, note, or other debt arrangement from the enterprise in exchange for the contribution of capital. This includes any stock redeemable at the holder’s request. Provision for guaranteed returns and redemptions might be classified by the USCIS as impermissible debt arrangements. Also, the petitioner’s personal guarantee of a loan that is the primary obligation of the enterprise does not constitute an equity investment of capital by the petitioner.

Kinds of Capital

“Capital” may include cash and cash equivalents, equipment, inventory, and other tangible property. Although capital does not include loans made by the petitioner to the enterprise, the investor’s contribution to the enterprise of the cash proceeds of a loan secured by assets owned by the investor may be considered capital, provided the investor is personally and primarily liable for repayment of the debt, and the assets of the enterprise upon which the petition is based are not used to secure any of the indebtedness.

Separately, the use of a promissory note payable by the investor to the enterprise – as a present commitment to contribute cash to the enterprise in the future – may be considered capital in limited circumstances where the promissory note is secured by the assets of the petitioner, the obligation is a perfected security interest, and the promissory note is valued in fair market U.S. dollars at the time it is contributed to the enterprise. Valuation of the promissory note requires consideration of the value of the assets securing the note, the amenability of the assets to seizure, and the expenses of enforcing a foreign judgment if necessary. An investor also may use a schedule of payments or a promissory note as evidence of being “in the process of investing” the required capital, however, the USCIS requires that payments of the minimum-required capital must be substantially completed before the end of the two-year conditional residence period.


The investor may use an escrow, conditioning release of funds to the enterprise on approval of conditional residence status or approval of Form I-526. However, the USCIS has advised that the escrow must release funds directly into the enterprise’s accounts for job-creation purposes.

“At Risk”

The USCIS requires proof that the capital invested is “at risk.” The USCIS focuses on actual and intended uses of capital to confirm that it will be used for job creation and profit-generating activity. The USCIS requires more than a deposit of funds into a business account, instead requiring evidence of the actual undertaking of business activity. The USCIS has held that use of capital for partnership expenses and reserve accounts unrelated to job creation eliminates consideration of that capital in counting the amount invested by the petitioner.

Tracing and Lawful Source

The law requires proof that capital is invested by the petitioner. Thus, an investor-petitioner should present evidence that traces capital from the enterprise back to the petitioner as a source.

The USCIS also has required that a petitioner present evidence that the source of the capital is a lawful one. Regulations specify evidence requirements such as five years of income tax returns. The USCIS also has required evidence of the investor’s level of income. Where the investor’s funds have been received by gift or loan, substantial evidence concerning the bona fides of the donor or lender typically is required.

Benefit the U.S. Economy

The investment must “benefit the U.S. economy” in order to qualify the investor for permanent residence status. Arguably, the petitioner has benefitted the economy by meeting the employment and investment requirements of the visa classification. No additional evidence is required in the typical case. However, considering that federal regulation of foreign investment is extensive (for example, in aviation, banking, communications and energy resources) and local economic factors vary widely, it is possible that an investment may not be deemed beneficial to the U.S. economy if it is made in a regulated industry sector or in a volatile local economy sector that protests the foreign investment.

Create or Save Jobs

The investor must create full-time employment positions for at least 10 U.S. citizens, lawful permanent residents or other immigrants lawfully authorized to be employed in the United States. The investor, his or her spouse and children do not count toward the 10 employee minimum. Non-immigrants (i.e., those with E, H, L and other temporary worker visas) are also excluded from the count. An “employee” is an individual who provides services or labor for the new commercial enterprise, and receives wages or other remuneration directly from the new commercial enterprise. This definition excludes independent contractors. Under the investor Pilot Program the job creation is not restricted to employees of the new commercial enterprise, but rather the investor’s petition may include evidence of indirect creation of jobs throughout the economy, as estimated by an expert economic analysis or other reasonable methodology.

When Jobs Must Exist

The petitioner may base the Form I-526 on proof that the required jobs have been created, or on proof that the required jobs will be created before the end of the two-year conditional residence period. In the latter case the investor must support the Form I-526 with a comprehensive business plan demonstrating a need for at least 10 employees before the end of the conditional residence period. The plan must describe the business, its products and services; must include a marketing analysis, including an analysis of the competition’s products and pricing; must include a marketing strategy; must identify the organizational structure and specific plans for hiring of staffing; and must provide financial projections. This requirement may be modified in cases involving investment with a regional center.

Troubled Business/Saving Jobs

Special rules govern investments in “troubled” businesses. A troubled business is one that has been in existence for at least two years, has incurred a net loss for accounting purposes during the 12 or 24 month period before the petition was filed, and the loss for such period is at least equal to 20 percent of the business’s net worth before the loss. If the petition is based on investment in a troubled business, the investor is not required to create 10 new jobs. Instead, the petition may be based on proof that the business will maintain the number of existing employees during the conditional status period.

Regional Center/Indirect Jobs

To encourage immigration through investment, and to concentrate investment in specific regions, Congress created a temporary Pilot Program in 1992, directing the USCIS to set aside visas for people who invest in a designated “regional center.” The Pilot Program currently sets aside 3,000 visas annually. The Pilot Program does not require that the commercial enterprise employ 10 U.S. workers, as long as the investor can reasonably demonstrate that the investment has created 10 or more jobs indirectly.

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