Key Takeaways:
- The EB-5 Immigrant Investor Program stimulates economic growth through capital investment and job creation by foreign investors.
- Recent reforms to the EB-5 visa category have revamped requirements and extended the Regional Center Program authorization.
- An investor must create at least 10 full-time positions for qualifying employees to meet EB-5 visa requirements.
The EB-5 Visa is a highly sought-after immigration pathway for those looking to invest in the United States. As an investor, understanding the nuances of the visa, particularly around job creation and employee count is critical. Let’s dive into the details.
Understanding EB-5 Visa Job Creation Requirements
The EB-5 Immigrant Investor Program is administered by the United States Citizenship and Immigration Services (USCIS), with the goal of stimulating economic growth through capital investment and job creation by foreign investors. Originating from Congress in 1990, the program includes investments through regional centers.
The New Rules from the 2022 Reform
Recently, changes have been made to this visa category. As highlighted by VisaVerge, on March 15, 2022, significant reforms came into being when President Biden signed the EB-5 Reform and Integrity Act. This act, part of the Consolidated Appropriations Act, 2022, revamped requirements for the EB-5 immigrant visa category and extended the Regional Center Program authorization through September 30, 2027.
How Many Jobs Must be Created?
At the core of the EB-5 visa requirements is the stipulation that an investor must invest a certain amount of capital in a new commercial enterprise that will create full-time positions for at least 10 qualifying employees. This rule is unwavering and central to the investor’s ability to qualify for the EB-5 classification.
Direct vs. Indirect Job Creation
Let’s elaborate the job creation expectations for those investing within a regional center.
Direct Job Creation
For new commercial enterprises that are not situated within a regional center, the business must directly create full-time jobs. This means that the enterprise, or its wholly owned subsidiaries, must be the actual employers of these qualifying individuals.
Indirect Job Creation
Conversely, enterprises within a regional center have broader options. According to USCIS definitions, these businesses can satisfy up to 90% of the EB-5 job creation requirement through indirect job creation. These are jobs that exist outside the business but are created as a result of the enterprise’s activities.
Qualifying Employees Explained
A question often asked is: Who qualifies as an employee under the EB-5 program? Simply put, a qualifying employee can be:
- A U.S. citizen
- A lawful permanent resident
- Any other immigrant authorized to work in the U.S., including conditional or temporary residents
Notably, individuals who do not qualify include:
- The immigrant investors themselves
- Their immediate family members
- Noncitizens with nonimmigrant status or without work authorization in the U.S.
Full-Time Position Requirements
The EB-5 visa mandates that employment positions must meet a minimum of 35 working hours per week to be considered full-time. This applies to both direct and indirectly created jobs. Job-sharing arrangements where two or more qualifying employees share a full-time position will be counted, provided the combined hours meet the full-time requirement. However, part-time positions, even if combined, do not count toward this requirement.
Non-Qualifying Positions
It’s equally important to note what doesn’t qualify. Jobs that fall into the categories of intermittent, temporary, seasonal, or transient do not fulfill the EB-5 full-time job criteria. A job with a duration of at least two years, however, generally overcomes this exclusion.
Special Considerations for Troubled Businesses
Different rules apply, however, for troubled businesses. Recognized as having been in existence for at least two years and having incurred a net loss of at least 20% of its pre-loss net worth over the prior 12- or 24-month period, a troubled business offers the investor an alternative route. The investor may rely on job maintenance rather than job creation, which means that for at least two years following the investment, the existing number of employees must remain no less than before the investment.
Final Thoughts on EB-5 Investment Rules
Regional center EB-5 investment rules and EB-5 job creation requirements play an integral role in qualifying for this visa program. Prospective investors should meticulously ensure they meet the stipulated conditions regarding job creation and maintenance while also supporting the United States’ economic health.
For more details on the EB-5 Immigrant Investor Program, potential investors can consult official resources such as the USCIS EB-5 page which provides comprehensive and up-to-date information.
With careful planning and understanding of the intricacies of the EB-5 process, investors can work towards achieving their goals of contributing to the US economy and securing a future within its borders.
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Glossary
- EB-5 Visa: The EB-5 visa is an immigration pathway that allows foreign investors to obtain permanent residency in the United States by making a qualifying capital investment in a new commercial enterprise that creates jobs.
United States Citizenship and Immigration Services (USCIS): The USCIS is a government agency responsible for administering immigration and naturalization services in the United States, including the EB-5 Immigrant Investor Program.
Regional Centers: Regional centers are designated entities under the EB-5 program that facilitate investment projects and job creation in specific geographic areas. Investments made through regional centers have the opportunity to satisfy a portion of the EB-5 job creation requirement through indirect job creation.
EB-5 Reform and Integrity Act: This act, signed by President Biden, implemented significant reforms to the EB-5 visa category. It revised the requirements for the program and extended the authorization of the Regional Center Program.
Capital Investment: Capital investment refers to the amount of money that an EB-5 investor must invest in a new commercial enterprise to qualify for the EB-5 visa. The investment amount varies depending on whether the investment is made in a targeted employment area (TEA) or a non-TEA.
Qualifying Employees: Qualifying employees are individuals who are employed in the new commercial enterprise created through the EB-5 investment. They must meet certain criteria, such as being U.S. citizens, lawful permanent residents, or other immigrants authorized to work in the U.S.
Direct Job Creation: Direct job creation refers to the creation of full-time employment positions within the new commercial enterprise itself or its wholly owned subsidiaries.
Indirect Job Creation: Indirect job creation refers to the creation of full-time employment positions that are not directly employed by the new commercial enterprise but are created as a result of the enterprise’s activities. Regional centers have the flexibility to fulfill up to 90% of the EB-5 job creation requirement through indirect job creation.
Full-Time Position: A full-time position, as required by the EB-5 visa program, refers to an employment position that involves a minimum of 35 working hours per week.
Troubled Business: A troubled business is a business that has been in existence for at least two years and has incurred a net loss of at least 20% of its pre-loss net worth over a specific 12- or 24-month period. Investors investing in a troubled business may rely on job maintenance instead of job creation to meet the EB-5 requirements.
Job Maintenance: Job maintenance, as applicable to the EB-5 program for troubled businesses, requires the investor to maintain the same number of employees in the troubled business for at least two years following the investment.
Intermittent, Temporary, Seasonal, or Transient Jobs: These are job categories that do not fulfill the full-time job criteria for the EB-5 visa program. Such jobs need to have a duration of at least two years to be considered qualifying positions.
Consolidated Appropriations Act, 2022: The Consolidated Appropriations Act, 2022 is a federal law that encompasses various provisions, including the EB-5 Reform and Integrity Act. It authorized and allocated funds for specific government programs and activities, including the extension of the Regional Center Program.
Targeted Employment Area (TEA): A targeted employment area is a geographic region defined by the state government that experiences high unemployment rates or qualifies as a rural area. Investments made in TEAs have lower investment requirements compared to investments made outside of TEAs.
Non-Qualifying Positions: Non-qualifying positions refer to job categories that do not meet the requirements of the EB-5 visa program, such as intermittent, temporary, seasonal, or transient jobs. These positions are not counted towards the job creation requirement.
So, there you have it! Understanding the job creation requirements for the EB-5 visa is crucial for potential investors. Whether you choose direct or indirect job creation, make sure to create full-time positions for at least 10 qualifying employees. Remember to consider the qualifications of employees and meet the minimum working hours per week. And if you want to dive deeper into the EB-5 program and explore more valuable information, head over to visaverge.com. Happy exploring!
This Article in a Nutshell:
The EB-5 Visa is a sought-after path for US immigration. The recent 2022 reforms brought changes to job-creation requirements, with direct and indirect creation options. Qualifying employees can be US citizens, permanent residents, or other authorized immigrants. Full-time positions must have at least 35 hours per week. Troubled businesses have alternative rules.
