An immigrant investor, along with their spouse and unmarried children under the age of 21, must be prepared to complete all four steps in the EB-5 petitioning procedure to become a permanent resident of the United States.
Step 1: Select a qualifying EB-5 project
Finding a project that would satisfy programme requirements is the first step for an EB-5 applicant, especially if they want to take advantage of the accelerated approval and rural premium processing options.
The investor must take into account these two intended outcomes when choosing an EB-5 qualifying investment: Green Cards and capital return. The first is concerned with the chance of receiving immigration benefits, and the second is concerned with the prospect of receiving a prompt return on investment.
EB-5 investment amount
The minimum investment needed to qualify for an EB-5 visa is $1,050,000, or $800,000 if the job creation takes place in a Targeted Employment Area (TEA). Projects in either a rural area or an area with a high unemployment rate are eligible for TEA certification.
Job-creation requirements
For EB-5 to be successful, job development is a crucial prerequisite. For investments to be eligible for EB-5, 10 full-time employment must be created in the United States.
Jobs created by EB-5 investments in Regional Center Program projects might be considered indirect and induced jobs. Only direct jobs created by the company that receives the capital investment are included in the permanent direct EB-5 program’s job count.
The fastest processing with projects in the national interest
The United States Citizenship and Immigration Services expedites the approval of EB-5 investments that are regarded to be in the interest of the country. Processing takes only two to six months as a result. The quickest EB-5 processing is currently available.
Reserved visas and premium processing with rural projects
20% of all EB-5 visas are set aside for investment projects in rural areas, and these projects are given priority processing. According to lawyers, this processing should take a year or less. With the set-aside, investors can obtain a visa right away. With a rural investment, a Chinese investor may move to the United States within a year and a half, whereas a conventional EB-5 investment may require a 10- to 14-year wait.
Exemplar-approved projects
Investors can have much more confidence that their petition will be acceptable to the immigration service if a project has received investor approvals or if the New Commercial Enterprise (NCE) requested an exemplar approval; however, there is no guarantee of approval if there have been “material changes” to the project since those approvals if USCIS will not take into account those changes.
Be aware that a project’s acceptance by an investor or an exemplar does not guarantee that the projected number of jobs will be created.
EB-5 investment financial return
Investors in EB-5 projects want to know that their money will be fully returned, if not at an attractive rate of return.
The capital stack and developer equity, which demonstrates skin in the game, are important factors that define an investment’s strength (developer equity is almost universally in a lower position in the capital stack then EB-5 money.) The EB-5 investment should ideally be in “first position” in the capital stack and be completely secured by project equity.
Exit strategy, or the process by which borrowed investor capital is returned to the investor, is another consideration. When filing an I-829, investors want their exit strategy to coincide with the date when their EB-5 investment capital is no longer required to be “at risk.” Investors should allow extra time for this since their expected I-829 filing date depends on how quickly their I-526 cases are resolved, which can be challenging.
It hasn’t historically been common for an EB-5 project to offer a high rate of return if it was anticipated to result in immigration advantages. Generally speaking, higher rates of return denote greater risk. Legitimate EB-5 investments, however, are providing stronger returns as the market develops.
Choosing an industry for EB-5 investment
In the past, EB-5 investments in real estate projects were preferred since jobs were predicted to be produced by an economist as long as the entire budget in the business plan was spent. Since real estate developments rarely come in significantly under budget, this greatly reduced the danger of employment creation. As a result, large real estate developments in prominent places were thought to be the most alluring since they were perceived as “safer” for the generation of jobs.
However, many of these big-city projects are no longer eligible at the lower investment level due to the passage of the EB-5 Reform and Integrity Act of 2022 and the new EB-5 programme criteria for TEAs. As a result, choosing real estate as an EB-5 project may not be as appealing as it once was.
Investors should be aware that TEA investment projects, particularly those in rural areas, can span a wide variety of businesses because they often offer reduced investment thresholds, visa set-asides, and preferential processing for rural investments.
Since many NCEs are no longer dependent on a specific location, it is simpler to qualify them for TEA certification. EB-5 projects today can be in many different sectors, such as manufacturing, healthcare, call centers, technological companies, and many others.
Investors should be open to a variety of project kinds and locations until they are comfortable spending $1,050,000 in a project that is not in the TEA.
How to make an EB-5 investment
Investors must sign a subscription agreement, which is a request to join a partnership or limited liability company, in order to make the investment. The investor will then accept the Manager’s or General Partner’s offer and send the investment amounts to an escrow account managed by an appointed escrow agent.
Step 2: Make investment and file EB-5 petition
After making an investment, the investor’s immigration lawyer will submit a Form I-526, the EB-5 petition, to the USCIS. The I-526 petition demonstrates that the applicant has paid the required capital into the EB-5 programme or is in the process of doing so.
We advise investors to speak with and hire a qualified EB-5 immigration attorney with whom they feel at ease before submitting their I-526 petition.
Requirements the I-526 filing must meet
- An EB-5 investor must be able to demonstrate that the money they invested was obtained legally, therefore they must have a legal source and path for their funds.
- The investor’s lawyer will certify that the business plan satisfies all “Matter of Ho” requirements and is credible in the eyes of USCIS.
- Invested monies must go into an NCE and be used for projects that will result in the creation of 10 new full-time employment in the United States.
- Until the conclusion of conditional permanent residency, the investor’s money must be put “at-risk,” meaning there is no certainty that it will be returned.
- An investment must comply with TEA standards at the time of the investment in order to qualify at the lower investment level of $800,000.
I-526 denial refund
Investors may be concerned about receiving their investment back if USCIS rejects a 1-526 petition. Investors may be given an I-526 refusal return assurance by the NCE, and the terms of the refund would be stated in the offering materials. But not all guarantees are created equal. In particular, if the project is disallowed and all investors demand a complete refund, it is crucial to determine who is providing the guarantee and whether the guarantor has the resources to fulfil the payback pledge.
However, this guarantee can, by definition, only appease a percentage of the NCE’s investors. Some NCEs will reserve 10–20% of all investor monies in an escrow account that would be used to refund a refused investor.
I-526 processing times
Processing timelines have been impacted severely by COVID-19 and other USCIS issues. Expert immigration attorneys anticipate the following for EB-5 processing as of 2022:
- Standard I-526 petitions are often decided in four to five years;
- expedited I-526 petitions are typically decided in two to six months;
- rural investment with premium processing is typically decided in one year (including petitions from China as rural set-asides create a new lineup)
Step 3: Conditional permanent residency for two years
Once an investor’s I-526 petition is authorized, there are two options to get conditional permanent residency:
- The investor must submit Form I-485 for status adjustment if they reside in the United States.
- Foreign-based investors submit Form DS-260 to a U.S. Consulate or U.S. Embassy.
The investor’s next stage in obtaining an EB-5 visa is to become a two-year conditional resident of the US after either application has been approved.
Filing an I-485 for a status adjustment
An EB-5 applicant can change their status from non-immigrant to permanent residence after receiving I-526 approval and relocating to the United States.
Immediately upon I-526 approval, this petition may be submitted. The document comprises six pages and costs $1,140 to file (not including the $85 fee for biometric services). It is strongly advised that the investor have an immigration attorney handle the filing.
Necessary documents for I-485
- Criminal background, two portraits of the petitioner,
- A copy of the petitioner’s passport, and
- A copy of the non-immigrant visa demonstrating current status in the United States.
- Petitioners aged 14 to 79 must undergo biometric screening, including fingerprinting, after filing.
Process of I-485
The average historical I-485 processing time for FY2020 (up to this point) according to USCIS is 13.7 months as of June 2020. While waiting for the I-485 to be completed, the petitioner may submit an I-765 Application for Employment Authorization and/or an I-131 Application for Travel Document.
The majority of petitions are granted. Denial, though not frequently, typically occurs when there has been a criminal or immigration law infraction.
Application for the DS-260
An EB-5 investor must submit a DS-260 application for conditional permanent residency if their I-526 petition is approved and they are not currently residing in the United States. It is handled by a U.S. Consulate or Embassy in the nation of the petitioner. It is strongly advised that you submit this paperwork through an immigration lawyer. Application and interview are the two components of the application.
Application details for the DS-260
The application contains biographical details, such as previous addresses, employment history, and military service history (if applicable).
The Department of State (DOS) amended its requirement on May 31, 2019, requiring DS-260 form applicants to completely reveal their social media activities over the last five years as part of a Social Media Disclosure.
Consular interview
This is done at the applicant’s nation’s consulate or embassy in the United States. This step of the application procedure is completed with assistance from a consular employee. Documents including birth certificates, passports, and marriage certificates may be requested of the applicant (if applicable).
I-485 or DS-260 approval: Green Card and subsequent steps
If an I-485 or DS-260 petition is approved, the petitioner receives a Green Card and becomes a conditional permanent resident of the United States. The validity of this status is two years. The investor’s family members are allowed to reside and work in the United States.
The EB-5 visa investor must comply with physical presence criteria during the 2-year conditional residency period and is not permitted to spend more than one year abroad. If the immigrant investor does live abroad for a period of time exceeding a year, they will need to apply for a re-entry permit.
The investor will wish to eliminate the requirements of permanent residency three months before the status’s expiration as a conditional permanent resident.
Step 4: Conditions are eliminated
The recipient of the EB-5 visa must then become a conditional permanent residence as the last step in the procedure. This is accomplished by removing the prerequisites for obtaining permanent residency following the submission, review, and approval of an I-829 application.
This application provides the United States Citizenship and Immigration Services with documentation that the petitioner has complied with all EB-5 programme requirements (USCIS).
I-829 necessary documents
- The following documents must be submitted:
- A conditional permanent resident card.
- Proof that a business was established, as shown by federal tax returns.
- Proof that the NCE received the petitioner’s capital investment.
- Proof that the business was maintained throughout the two-year conditional residency period.
- Proof that at least 10 full-time jobs were created in accordance with the business plan, as shown by payroll and tax records.
- Biometric identification, including a fingerprint (if applicable)
I-829 petition submission
90 days before the anniversary of the day the investor initially granted conditional residency, the I-829 petition is delivered to USCIS. The investor might not be given permanent residency if the I-829 is not submitted by the due date.
Usually, the immigration lawyer for an EB-5 investor submits the I-829 petition. The filing fee is $3,750, and there is an additional $85 biometrics charge.
After the I-829 petition has been processed, take note that USCIS may ask for an interview.
Processing time for I-829
The average historical I-829 processing time for FY2020 (as of June 2020) was 37.2 months, according to USCIS.
Approval of I-829
The EB-5 visa investor, their spouse, and their unmarried children under the age of 21 are awarded 10-year Green Cards that can always be renewed when an I-829 petition is approved (approval rates have consistently been well over 90%). They are now able to stay and work in the country on a permanent basis.
They will be given the chance to choose to become citizens of the United States with all relevant rights and privileges after five years from the time initial conditional residency was granted.