EB-5 Visa for Investing in Senior Housing Projects
The EB-5 visa is a way to get your green card and permanent residency through investment. The EB-5 investor visa program enables foreigners who make an investment in a U.S. business to obtain a green card and become lawful permanent residents, and eventual citizens, of the United States. The investment can lead to a green card for the investor to permanently live and work in the United States with their spouse and unmarried children under the age of 21. The EB-5 visa program is operated by United States Citizenship and Immigration Services (USCIS). The program was established by the United States Congress in 1990 to facilitate increased investment in the U.S. economy.
EB-5 Visa Immigrant Investment Requirements
To meet EB-5 investor visa requirements, foreign investors must make an “at risk” capital investment in a for-profit U.S. business entity. The required investment amount is either $800,000 or $1,050,000 million, depending on which project you invest in. If you invest in a targeted employment area (TEA) the investment is $800,000, if you invest elsewhere the minimum required investment is $1,050,000 million. EB-5 investments must lead to the creation of 10 full time U.S. jobs for at least two years.
EB-5 Reform and Integrity Act of 2022
A major overhaul of the EB-5 “regional center” investment visa program is included in the Consolidated Appropriations Act of 2022, which funds the federal government through September 30, 2022. The EB-5 Reform and Integrity Act is found at “Division BB” of the omnibus appropriations bill. It represents the first major reforms to the EB-5 program since it was enacted in the early 1990s. Reforms include:
Reauthorized EB-5 “Regional Center” Program
- 5-year extension through September 30, 2027
- Reduces litigation risk from ~ 90,000 EB-5 investors who have seen no action by DHS on their petition since the regional center program expired on June 30, 2021.
Expanded Targeted Employment Area (TEA) Designations
TEA projects qualify for both lower investment levels and visa set-asides (see below):
Prioritizing Rural Projects
- In areas outside a Metropolitan Statistical area, or within the outer boundary of any city or town with a population of 20,000 or more. (No change from prior law).
- U.S. Citizenship and Immigration Services (USCIS) must prioritize processing visas for investors in rural areas.
New Criteria for Distressed Urban Area Projects (“High Unemployment Areas”)
- Codified the 2019 USCIS regulation (“donut” approach in which a project must be within a census tract – or any “contiguous” census tracts that “touch” the project’s tract – where the average unemployment rate is 150% of the national average.
- DHS Secretary has the discretion to include a “directly adjacent” tract (to either the “anchor” tract or a “contiguous” tract) to satisfy the requisite 150% high unemployment criteria.
- Distressed Urban TEA designations last for 2 years. These can be reviewed if the qualifying census tract(s) continue to meet “high employment” criteria.
- If a project was in an Urban TEA but falls out of high unemployment status, an “original” investor does not have to increase investment amounts to the non-TEA upper level.
- Only DHS can approve an Urban TEA “high unemployment” designation – unless the Secretary designates such authority to another federal official. No state or local official can approve.
Defining “Infrastructure Projects”
- A “capital investment project” administered by a “government entity” – that serves as the “job-creating entity” funded by EB-5 investors, and that contracts with a regional center –qualifies as an “Infrastructure Project.”
- Must be a “public works project.” No particular type of infrastructure “asset class” specified.
- Only DHS can designate an Infrastructure Project – unless the Secretary designates such authority to another federal official. No state or local official can approve the designation.
Qualified Investment Amounts & Adjustments
- $800,000 in TEAs
- $1,050,000 in non-TEAs
- On January 1, 2027, and every 5 years thereafter, investment amounts adjust for inflation.
- Non-TEA level “adjusts up” for inflation.
- TEA level “adjusts up” to 75% of the non-TEA level (with the goal of keeping the $250K delta between investment levels intact).
Clarifying Visa Set-Asides
- Set asides are a percentage of the roughly 10,000 EB-5 visas available every year.
- 20% for Rural projects
- 10% for Distressed Urban/High Unemployment Area projects
- 2% for Infrastructure Projects
- Unused visas “carry over” in the same category in the following year.
- Unused visas in any “set aside” category made generally available for any project, in the year immediately following the “carry over” year.
“Aging Out” Criteria
- An investor’s “child” who is admitted to the U.S. on a “conditional” basis and who turns 21 shall continue to be considered a “child” if:
- she/he remains unmarried and
- the principal investor is approved as a permanent resident and
- the principal investor files a petition for the child to remain in the U.S. no later than 1 year after the child’s conditional status has terminated.
- The principal investor can only file 1 “aging out” petition after the child turns 21.
Allowing the Broad Redeployment of Capital
- DHS to enact regulations that allow the new commercial enterprise to deploy capital anywhere in the U.S. to keep the investment “at risk.”
Sovereign Wealth Funds (SWFs)
- Capital from a “bona fide” SWF may be stacked with EB-5 capital to finance a project.
- The SWF can be involved with the equity “ownership” – but not the administration – of the job-creating entity.
- DHS to implement regulation for SWF funding in an EB-5 project.
Job Creation Criteria
- 10 jobs must be created per investment (same as prior law).
- 1 job must be a “direct” job. It can be “modeled” and it is not necessary to produce a W-2 for a particular employee.
- The other 9 jobs can be “indirect,” modeled, and estimated (same approach under prior law).
- Construction jobs that last less than 2 years can satisfy 75% of the estimated “indirect” jobs.
Allowing the Concurrent Filing of I-526 and I-485
- Investors can concurrently file their I-526 petitions (showing EB-5 compliance and investment) and their I-485 petitions (application for a “conditional” green card, which adjusts status from a “non-immigrant” to a conditional permanent resident). This can only be done if there is already a visa number available and current.
- Concurrent filing can reduce the time to adjust status once an I-526 is approved.
“Grandfathering” Existing Investors
- If Congress fails to reauthorize regional centers after the Act’s expiration on September 30, 2027, DHS will continue to process petitions filed on or before September 30, 2026.
- Applies to I-526 petitions and I-829 petitions (to remove conditional status and allow permanent residency without conditions).
- DHS may not deny an I-526 or I-829 simply because the regional program might expire in the future.
- An investor is eligible to file the I-829 2 years after filing the I-526.
New “Integrity Measures” to Deter Fraud and Safeguard National Security
- USCIS to conduct an audit of each regional center at least once every 5 years.
- Explicit authority granted to USCIS to deny regional center “business plans” where an applicant has engaged in fraud, criminal conduct, or where plan approval would threaten national security.
- Confirms the application of U.S. securities laws over regional center offerings and investment advice.
- Regional center must submit annual statements of investment activities to USCIS. Failure to submit or falsify an annual statement results in sanctions that can include fines, temporary suspension, and a permanent “de-bar” of individual and regional centers that fail to comply with new oversight requirements.
- No person convicted of a crime (in the last 10 years) or fraud-related civil offense (that resulted in liability greater than $1M USD) can participate in EB-5 activities.
- With a limited exception for bona fide sovereign wealth funds, no foreign government representative may provide EB-5 capital or be involved in the administration or ownership of a regional center, new commercial enterprise, or job creating entity.
- Requires fingerprints and other biometrics of persons involved in EB-5 activities to be submitted to USCIS.
Strict new “source of funds” requirements to ensure that an investor’s funds are derived from legitimate and lawful sources.
- Establishment of a new “EB-5 Integrity Fund,” capitalized by regional center program feeds, to support amplified USCIS oversight and site visits.
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