Congress established the EB-5 Program in 1990 to bring new investment capital into the country and to create new jobs for U.S. workers. The EB-5 Program is based on our nation’s interest in promoting the immigration of people who invest their capital in new, restructured, or expanded businesses and projects in the United States and help create or preserve needed jobs for U.S. workers by doing so.
In the EB-5 Program, immigrant investors who invest $1 million (or $500,000 if investment is in a Targeted Employment Area) in job-creating businesses and projects in the United States receive conditional permanent resident status in the United States for a two- year period. After two years, if the immigrant investors have satisfied the conditions of the EB-5 Program and other criteria of eligibility, the conditions are removed and the immigrant investors become unconditional lawful permanent residents of the United States.
Congress created the two-year conditional status period to help ensure compliance with the statutory and regulatory requirements and to ensure that the infusion of investment capital is sustained and the U.S. jobs are created.
The first step in the EB-5 immigration process is to file Form I-526, Petition by Alien Entrepreneur with the USCIS.
Upon approval of Form I-526, either: (1) File Form I-485, Application to Register Permanent Residence or Adjust Status, with USCIS to adjust status to a conditional permanent resident within the United States; or, (2) File DS-230 or DS-260, Application for Immigrant Visa and Alien Registration, with the U.S. Department of State to obtain an EB-5 visa for admission to the United States.
Once the I-485 application is approved, or upon entry into the United States with an EB-5 immigrant visa, the EB-5 investor and derivative family members (i.e. spouse and any unmarried children under the age of 21) will be granted conditional permanent residence for a two-year period.
The EB-5 investor must then file Form I-829, Petition by Entrepreneur to Remove Conditions, 90 days before the two-year anniversary of the granting of the EB-5 investor’s conditional resident status.
Finally, and if the USCIS approves the I-829 Petition, the conditions will be removed from the EB-5 investor’s status and the EB-5 investor and derivative family members will be allowed to permanently live and work in the United States.
Without doubt, job creation is the most important requirement of the EB-5 Program. A project must create a minimum of 10 full-time jobs for each EB-5 investor. For example, if five EB-5 investors each invest $500,000 in a project, then that project must create a minimum of 50 full-time jobs.
If an EB-5 investor invests in a project that is not sponsored or affiliated with a Regional Center, then only direct jobs can be counted. Direct jobs are generally those full-time jobs filled by W-2 employees of the new commercial enterprise. An EB-5 investor would then need to demonstrate direct jobs to the USCIS by producing W-2 tax forms and legal working status for at least 10 full-time job employees.
However, if the project is sponsored or affiliated with a Regional Center, then the type of jobs that can be counted include direct, indirect, and induced jobs. These jobs are demonstrated to the USCIS by an economic impact report, produced by a Regional Center’s economic analysis team.
The ability to include both indirect and induced jobs significantly increases the likelihood that an EB-5 investor will be able to satisfy the 10 full-time job creation requirement. This is why, each year, 90-95% of EB-5 investors decide to invest in projects either sponsored or affiliated with a Regional Center.