Can parents gift investment funds to their children for EB-5 purposes?

Gifting Funds for Children to Apply for an EB-5?

Providing a gift to one’s child in the form of investment funds for an EB-5 visa is an increasingly common and acceptable practice for supporting an application. However, there are some specific requirements that need to be kept in mind. The following is information that parents and their representatives should know prior to gifting the money for EB-5 visa purposes.

Requirements for gifting EB-5 funds to children:

Gifted funds may be used as the initial investment for EB-5 visas. However, the donor must prove that the fund originates from a lawful source. The donor must provide specific documentation of the origin of the funds such as tax returns, earning statements and bill of sales certificates.

Donors must also provide a statement that there are no intentions of expected repayment of the gift back from the child to the parent.
Preparing documentation for EB-5 source funds:

It is in the best interest of donors and recipients to first consult an experienced immigration attorney for the determination of the best way to gift funds for the EB-5 program. It is also important to review the options for funding that are open to use for the program and select the one that would be easiest to prove. Each of the documents that show the source of the funds should be organized and copied. Prior planning is necessary due to the time it may take for services such as document translation to be completed.

International students and EB-5 investments:

More and more international students are taking advantage of the EB-5 program as the option helps them reach their academic and professional goals. The EB-5 is special in that it does not burden the student with a number of restrictions.
Besides using gifts from parents, children are also able to use their inheritance to fund the required amount for their EB-5 visas. It is important to further speak with an experienced immigration attorney to know what the specific documents that will be needed to prove the source of the funds.

Gifting the funds of the EB-5 program through Regional Centers

Foreign investors who have a high net worth are able to apply for a Green Card under the US EB-5 program with an investment. Provided the investment made is able to meet the requirements, such as creating jobs for American workers, the investor will receive green cards for themselves and family members.

The EB-5 program has a minimum required amount of $900,000 that must be invested. However, those who are interested and need help accumulating the minimum amount are able to receive help from family members such as parents, siblings or children.

The EB-5 procedure can be unpredictable, and a slip up could cause a needless delay in the accepting process for I-526 petitions. Fraud is a major concern throughout the EB-5 process. Because of this, each investor’s source funds are traced to its origin to ensure that the capital has come from legal sources.

To guarantee that transferring the investment funds goes easily, here are a number of tips

Funds to be used in an EB-5 investment that have been gifted, should go to a personal account that is in the name of the investor. Family members will be able to use the account for checking or transfers. It is also important to have a declaration that states the money that is being transferred is indeed a gift. Once the funds enter the account, the investor will be able to place it into an escrow account for the EB-5 program.

While the above section provides information of how to transfer the gifted amount for an investment into an EB-5 program, it does not show the funds are legal. This is one of the most important parts of the process. There will be a need for the funds to have proof that they originated from a legal and lawful source. This means that the person making the gift will have to show the origin of the money.
It is a good idea to use an experienced immigration attorney to help assist in the documentation that is necessary to prove the source of the funds is legitimate. Please consult one of our team members to understand the Source of Funds requirements.

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