Employment Based 5th Preference (EB-5) is a US Citizenship and Immigration Services (USCIS) program created by Congress in 1990 that grants permanent residence (i.e. green cards)toqualified foreign nationals and their families in exchange for at-risk investment of $500,000 or $1 million (see question 4) that creates a minimum of ten jobs.
Investors must invest in a business that will create at least ten jobs per EB-5 investor over a two-year period. Investments can be one-off transactions, usually facilitated by immigration attorneys, or made through USCIS-approved Regional Centers (see question 3). Investments can be structured as equity or debt. The up-front cost of establishing this investment is high, and therefore most transactions have to balance up-front costs and the number of investors per deal. Job-intensive real estate projects are best, which is why hotels and assisted living facilities work well.
US Congress created the Regional Center program in 1992, which allows foreign nationals to invest in a USCIS approved Regional Center with the goal of promoting economic growth in the US through many different methods, including increased exports, job creation, and foreign direct investment (FDI). Regional Centers are run by private or public organizations or public-private partnerships that cover a specific geographical region. The advantage of investing through a Regional Center is that their investments can count indirect jobs in addition to direct jobs. Projects processed without a Regional Center can only count direct jobs. Regional Centers also provide a one-stop service, usually bringing together immigration, financial structuring and economic modeling. About 90% of all EB-5 investments are made through Regional Centers.
Investment in Targeted Employment Areas (TEAs) qualifies projects for a $500,000 investment rather than $1 million per EB-5 investor. TEAs include all rural areas (non-metropolitan statistical area (MSA) cities or counties with a population under 20,000), and census tracts within cities that have unemployment rates that are 150% of the national average.
The basic requirements for each EB-5 investor are:
- Invest a minimum of either $1 million or $500,000 in a commercial enterprise
- The investment funds must be at risk
- The investment results in the creation or preservation of ten (10) full-time jobs for U.S. workers, over a two year period
Click the following link to download our EB-5 investor process flow chart.
Yes, the EB-5 investor, spouse, and all children under the age of 21 at the time the immigrant visa is adjudicated are eligible under the EB-5 program to receive green cards.
EB-5 investors may be involved in the day-to-day operations primarily if the investment is a non-Regional Center project. However, in most Regional Center projects, EB-5 investors are only involved inthe management or policy-making of the enterprise, typicallyas a member of a limited liability company or limited partner in a limited partnership.
USCIS requires that each EB-5 investor show evidence that the investment funds were obtained through lawful means. Examples of evidence can include, but are not limited to business records, personal and business tax returns, bank statements and documentation of real estate transactions.