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When embarking on their journey to receive an EB-5 visa, one worry investors will undoubtedly have is whether or not their I-526 petition will be approved. The I-526 petition declares an investor’s intent to apply for an EB-5 visa, and includes all the necessary evidence of their eligibility to receive one. Ensuring that your I-526 is approved is essential if you wish to receive an EB-5 visa.
What is the Most Common Reason for Denial?
Investors’ anxieties should be alleviated by statistics from USCIS on I-526 approval rates. USCIS approves the vast majority of each years I-526 petitions, and 75% of all I-526 petitions adjudicated in Fiscal Year 2020 were approved.
While these high approval rates are encouraging, investors will still want to know the most common cause for USCIS denying an I-526 petition, and how to avoid it themselves.
Assuming an immigrant investor has selected a suitable project to invest in and has made the required minimum investment, the most common reason for denial of an investors I-526 petition is failure to demonstrate “lawful source” of their investment funds.
USCIS requires that immigrant investors’ capital for EB-5 projects be lawfully sourced, that is it needs to have been earned or acquired legally. You are required to provide evidence that all funds have been lawfully sourced as part of your I-526 petition, and you will need to be meticulous when gathering this information.
So How Do I Prove Lawful Source of Funds?
Although this requirement might seem daunting at first, in reality it is a very straightforward task. In fact, proving that your investment is legally sourced is usually a simple matter of gathering the proper paperwork.
Your I-526 petition will have to include documentation of how your funds were sourced, as well as how those funds were transferred to your chosen EB-5 project. The standard as set by USCIS, is that investors “must prove by a preponderance of the evidence” — in other words, that it is more likely than not — that their funds have been lawfully sourced and transferred.
What Do I Need to Include?
Every investors petition will differ in what documents they need to provide but generally they could include any and all of the following:
- Bank statements
- Tax returns
- Employment records
- Loan documents
- Investment records
- Property records (for example, a purchase contract, a sale contract)
- Gift records
- Business accounting records
Sometimes you will need to specifically trace the funds. For example, if you are selling your property and using those funds as your EB-5 investment, you might include:
- The purchase contract for the sale of the property,
- An appraisal evidencing the fair market value of the property,
- The bank statement/records showing the purchase funds deposited into your bank account, and,
- The bank statement/records showing those same funds being transferred into the United State to become your EB-5 investment proceeds.
While you could try to accomplish this by yourself, hiring an immigration attorney to handle submitting your I-526 petition is strongly recommended. Simply put, an experienced attorney will have the knowledge, skills, and experience necessary to assemble your petition and show that you are in compliance with all the rules and regulations of the EB-5 program.
When Do I Start?
As you prepare to invest in the EB-5 Regional Center program, you should begin thinking about the “lawful source” of your investment funds. You will want you to begin gathering these documents now, in advance of submitting your I-526 petition to USCIS.
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