Articles

Applications for EB-5 Visas Rise Along with Government Scrutiny of the Program by John Ebenger


Posted on January 24, 2014 by John Ebenger

In 2013, 6,434 foreign investors applied for visas under the EB-5 Immigrant Investor Program, which allows qualifying foreigners who invest in U.S. projects to expedite residency requirements.

Launched by Congress in 1990 to help stimulate job creation through capital investment by foreign investors, the EB-5 program provides investors and their family members with temporary visas in exchange for their investments of between $500,000 and $1,000,000 in new commercial projects that create or preserve a minimum of 10 full-time jobs. After two years, the investors may convert temporary visas to permanent residence status.

According to the Department of Homeland Security’s U.S. Citizenship and Immigration Services, which oversees the EB-5 program, 3,696 applications have been approved as of Sept. 30, 2013; 942 were denied. The majority of investors were Chinese nationals followed by South Koreans, who lagged by a wide margin.

Despite the record number of EB-5 application received last year, the rate of growth in program participation has decreased from 58 percent between 2011 and 2012 to five percent from 2012 to 2013.

Entrepreneurs and expanding businesses seeking to raise capital may find EB-5 financing less demanding and time consuming than that required through traditional banks and VC funding. The potential amount of investment dollars is almost limitless. However, qualifying a project for EB-5 investment is not a simple process. As the U.S. Citizenship and Immigration Services has increased scrutiny of the program, businesses and foreign investors must take the appropriate steps to seek the counsel of experienced counselors who understand all the nuances of the program and can cross every “t” and dot every “i” to ensure compliance.

About the Author: John G. Ebenger PA is a director in the Real Estate and Tax Services practice at Berkowitz Polack Brant. For more information, call (561) 361-2100 or e-mail info@bpbcpa.com.