May 30, 2018
E-2 Visa Source of Funds: Do Loans or Gifts Count?
What E-2 Visa source of funds are permissible? How much do you need to invest to obtain this visa? To secure an E-2 Visa, you are required to invest a “substantial” amount of money or assets in a business enterprise in the United Sta
What E-2 Visa source of funds are permissible? How much do you need to invest to obtain this visa? To secure an E-2 Visa, you are required to invest a “substantial” amount of money or assets in a business enterprise in the United States. The money or assets invested must come from a legitimate source of funding and be completely in your possession and control. This article explores two alternate methods to fund your new commercial enterprise.
Gifts and Loans as your E-2 Visa Source of Funds
To increase your chances of obtaining an E-2 Visa, you should invest at least $100,000 in the commercial enterprise. Although this amount is well below the capital requirement for an EB-5 Investor Visa, it is still a considerable amount of money for most people. The number one E-2 Visa source of funds used by investors is their savings; however, not all entrepreneurs have the means to “gamble” $100,000 in cash on a business.
The question becomes this: are there other funding options for prospective E-2 Visa investors who don’t wish to risk $100,000 on a U.S.-based business? Let’s explore the options for alternate funding for your commercial enterprise.
Can a Gift Replace My E-2 Visa Source of Funds?
You may fund your E-2 Visa business with a gift, using money or assets received as a donation to fund your E-2 Visa commercial enterprise. Money acquired as a gift fulfills source-of-fund requirements imposed by the U.S. government. As such, you may invest money you receive through inheritance, or the generosity of a benefactor, whether it is a family member, a friend, or an acquaintance, as long as you are already in possession of the money.
There is one caveat to this rule: inheriting a business is not enough to satisfy the E-2 Visa source of funds requirements for investment. Therefore, if you inherit a business in the U.S., you will not be entitled to an E-2 Visa on the sole basis of that business.
Can I Fund My E-2 Visa Business with a Loan?
In theory, you may fund your E-2 Visa business with a loan. However, the loan must meet specific requirements to be considered an adequate investment by the consulate officer responsible for deciding whether to grant you a visa.
To qualify for an E-2 Visa, your investment should be at risk. Any loan secured by your personal assets meets the investment requirements. However, a loan secured by assets from the business does not fulfill the investment requirements.
In theory, you can use an unsecured loan to fund your U.S. business. In practice, you may have a hard time arguing your case in front of the consulate officer. Your E-2 Visa application may be denied on the ground that you are not risking anything, because you could always walk away from the loan. Finally, the consulate officer may find your business to be highly leveraged, and therefore not viable.
Prewitt Law Firm can help you find a legitimate E-2 Visa source of funds to shape a strong visa application. We are intimately familiar with application requirements and can help you make the best decisions regarding the structure of your business to meet essential prerequisites for successful visa processing.
If you are starting a business in the U.S. and would like to start the application process, or if you wish to further explore your options, give us a call us at (+1) 646.583.1206 or contact us through our website to set up an appointment. We look forward to helping you to process a successful application.