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The EB5 investment increase is only a few days away. The EB5 Modernization Regulation is set to increase the minimum investment amounts on November 21, 2019.
The new minimum investment amounts for TEA projects will be $900,000 and the new minimum investment amounts for non-TEA projects will be $1.8 million. These amounts are nearly double what the current investments amounts are today. (TEA stands for targeted employment area.)
Applying prior to the deadline would allow investors to save between $400,000 and $800,000 depending on whether they choose to invest in a TEA project or a non-TEA project. Applying now would also grandfather investors into the program under current rules.
November 21, 2019 is also the EB-5 Regional Center Program sunset date.
The EB-5 Regional Center Program requires reauthorization, while the EB-5 Direct Investment Program is permanent. Congress will likely pass a short-term continuing resolution that would reauthorize the EB-5 Regional Center Program for several weeks. A new bill called the “EB-5 Program Reform Act” was introduced to the Senate earlier this month and would make significant changes to the EB-5 Program if it were to pass.
While it’s unlikely to pass prior to the EB-5 sunset date, it could pass this year. The biggest news from the EB-5 Reform Act is that it would provide relief for backlogged EB-5 applicants who have been waiting at least three years. Backlogged investors, along with their derivatives, could qualify for parole (entry) into the United States and work authorization while they wait for visas to become available.
The EB-5 Reform Act would also make other major changes including:
- Changing part of the TEA definition from high unemployment areas to urban distressed areas.
- Setting aside 30% of the visas for TEA investments and having any leftover visas roll over annually into the general pool of visas.
- Changing the TEA investment amount from $500,000 to $1 million and non-TEA investment amount from $1 million to $1.1 million.
- Introducing a new DHS per petition fee of $50,000.
- Including many new program integrity reform measures.
For more information about the latest EB-5 news, send us a message.
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