In this video, Attorney Menchaca will be reviewing the most frequently asked questions about the EB5 Visa.
EB5 – Frequently Asked Questions
Attorney Menchaca, let’s talk about the EB5 visa.
Can you answer some frequently asked questions?
What exactly is an EB5 visa?
The term EB5 visa is actually a misnomer.
EB5 is actually a category of priorities used to apply for the green card and it’s a very high priority.
So people who apply through the EB5 to get a green card usually have a faster processing time then other people who apply for the green card.
Earlier, you mentioned something of along the lines of a regional center or sometimes called an investment fund what exactly is that?
They’re investment funds specifically designed for you to apply for EB5.
Most traditional investment funds that you’ve heard about and from your bank or from Wall Street on the news, they tend to have one goal in mind, the goal is to make money.
These regional centers for the EB5 actually have two goals, they try to make money and they try to create the jobs that you need to qualify for the EB5.
So they work a little differently, and there’s about a thousand of these regional centers out there that you can invest your money in.
And you’re just going to go invest with them, they create the jobs for you, in other words you’re delegating the administration and the job creation to a third party so that you don’t have to do it yourself.
I see, so for example if I do decide to invest my money in investment fund, when would I get my half a million dollar investment back.
Oh, great question right, that’s what everybody wants to know.
So look it goes like this, it varies by investment center, so some regional centers will say look you’re gonna investor money here for a certain period of time, some request longer, some request shorter, but on the average most of them ask that you keep your money invested there for five years.
So you can’t take it out for five years at the end of those five years you’re eligible to withdraw your funds.
So for example, if I would like to invest in my own business such as a McDonald’s franchise, would I be able to apply for the EB5 visa?
Absolutely, the law lets you invest in one of two ways:
In your own business or in a regional center, one of these EB5 investment funds.
Now let me explain the differences between the two:
If you invest in your own business, you invest half a million or one million dollars depending on the geographic area.
And if you invest in a regional center, it’s the same rule half million or one million dollars depending on the geographic area.
Now job creation is where it gets tricky.
In your own business the government says look, you can get credit for creating ten jobs when those ten jobs are on your payroll, on the payroll of your company.
So if you have external employees such as a CPA, a marketing company, lawyers, engineers, people that are not directly on your payroll, but that work with you essentially, the government says external ones don’t count.
The only ones that count towards the ten jobs are the ones directly on your payroll.
On the other hand, if you’re investing in a regional center, it’s a lot easier to get to ten.
The rules are a lot more liberal, more lenient, so the rules say this:
When you invest in a regional center, direct job creation that your money has, any jobs at the regional center creates on the project’s payroll count.
And, we’re also going to count indirect job creation, we’re gonna count any external jobs that you create, so your CPA’s, your engineers and lawyers, construction workers, etc. get counted towards that ten job creation.
So it’s a lot easier to count to ten, or to get the ten in a regional center than it is in your own job, in your own business.
So in summary, the way I would describe this is look, if you invest in your own business you invest your money, your time and your energy.
If you invest in a regional center all you do is invest your money.
That sounds excellent, so most of your clients I bet would go through the regional center?
Absolutely most of my clients go through a regional center and most of the people throughout the country that apply for this visa do it through a regional center, like more than ninety percent of everybody who’s ever applied for an EB5 does it through a regional center because of the convenience.
I see, thank you attorney Menchaca.