The EB-5 program allows foreign investors to qualify for permanent residency and citizenship in the United States. Program applicants must directly invest at least $800,000 in EB-5 projects that create jobs for U.S. workers. During the initial EB-5 petition, the investor must provide proof of the source of their investment funds. Here are some of the funding sources you can use when starting an EB-5 project and tips for proving their legality:
Table of Contents
Earnings From Employment
Income earned through work is an approved source of investment capital for EB-5 projects. The employment can be through a third-party employer or personal business in any sector, provided it is legal. A prospective investor must be prepared to collect documents from various companies as proof of lawful sources of salary payment.
Documents like pay stubs and bank statements can help prove employment as the legal source of EB-5 investment funds. Letters from past employers verifying the investor’s position and salary may also be helpful. An investor must provide personal tax returns to show they have paid all the applicable taxes on their income. Earnings from a private business can be proven through employment contracts, financial statements, tax returns, and business registration records.
Capital From the Sale of Property
Investors may fund their EB-5 projects using capital from the sale of property. They must provide documents like the sale agreement and bank statements for the money received from the buyer as proof of lawful investment capital. The United States Citizenship and Immigration Services (USCIS) organization will also want evidence that the property was initially obtained legally, whether it was an inheritance or the investor bought it and then sold it for profit.
The EB-5 investor must provide inheritance papers, an initial purchase agreement, and proof of the legal source of capital used to acquire the property. They must also show tax returns on the property in question. If it is impossible to trace the documents from the initial purchase, USCIS may accept a detailed statement explaining why this is the case. Local officials must confirm this statement before it is sent to USCIS.
Investment Funds from Gifts
Gifts are considered valid sources of EB-5 investment capital. Young investors can join EB-5 programs using gifts from their parents or other family members. This allows them to work toward earning permanent residency while completing their studies in the U.S. An investor must provide documentation related to the gift receipt and other proof of the legality of the donation or gift.
Investors must provide a signed statement from the donor stating the beneficiary is not obligated to repay the gifted amount. USCIS also requires detailed information on the donor’s background to prove they obtained the initial capital legally. The gifting party must demonstrate how they earned the funds through proper documentation. Documents such as employment verification letters and tax returns can act as proof of legality.
EB-5 Investment Capital from Loans
Loans from institutional lenders or individuals are acceptable sources of EB-5 investment capital. Institutional loans make the application smoother because the USCIS doesn’t need proof of how banks secured their money. Investors must still provide documents showing they received the loan and their promise to repay it. These documents can include bank statements and loan agreements.
Loans from an individual must be accompanied by evidence of how the lender secured the amount. Declarations and tax returns that show proof of these market-rate loans are valid evidence. Investors must also show the source of funds for collateral assets if they were used to secure the loan.
EB-5 Project Funds From Inheritance
Inheritance is another common source of funds for EB-5 projects. If an investor plans to use their inheritance as investment capital, they must provide documentation of how and when they received the inherited funds. An investor may have received the inheritance years before they apply for the EB-5 visa. This investor must prove their relationship to the deceased. They should also provide a copy of the will, bank statements, probate court documents, and other related evidence.
Invest in EB-5 Projects
There are various acceptable sources of capital to use when starting EB-5 projects. Investors can obtain investment capital from gifts, inheritances, and other sources, provided the funds have lawful origins and supporting documents. An experienced EB-5 regional center consultant can help investors identify the types of documentation required to prove the sources of their investment capital. These experts can also help investors submit applications and manage EB-5 projects. Contact an EB-5 regional center today to learn more about the EB-5 visa program.
In conclusion, when initiating EB-5 projects, investors can draw from diverse funding sources, each requiring proof of legitimacy. Earned income, proceeds from property sales, gifts, loans, and inheritance can serve as acceptable capital. Investors must meticulously document the lawful origins of funds, providing evidence such as employment records, sale agreements, gift receipts, loan agreements, and inheritance-related documents. Expert guidance from an EB-5 regional centre consultant is invaluable for navigating documentation requirements, submitting applications, and effectively managing EB-5 projects. For those aspiring to participate in the EB-5 visa program, exploring these legitimate funding avenues with proper documentation is essential. Contacting an EB-5 regional center offers further insights into program intricacies and requirements.