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What International Students Should Know About EB-5

18th Mar 2024
Thanks to provisions in the RIA, students looking to pursue careers in America can broaden their possibilities with an EB-5 investment.

The EB-5 Immigrant Investor Program provides a path toward permanent U.S. residency for foreign nationals who make a capital investment in an approved project that creates at least 10 jobs. EB-5 helps spur economic development in American communities while allowing investors to pursue new lives in the United States.

Because of the high minimum investment amount ($800,000 for projects in a Targeted Employment Area, $1,050,000 for other areas), the stereotypical EB-5 investor is a High Net-Worth Individual (HWNI) who already has entrenched business interests. But thanks to a 2022 law, another category of visa holders is particularly well-positioned to take advantage of EB-5: international university students.

The F-1 student visa

Students from overseas who wish to study at American universities have traditionally applied for an F-1 Student Visa, which allows them to study at U.S. universities, seminaries, and other schools.

The F-1 approval process requires the filing of Form I-20 to verify acceptance by an approved school, followed by the filing of a DS-160 petition, and finally an in-person interview at the student’s local embassy or consulate. Wait times for these interviews can vary greatly depending on location, as you can see from this sampling of wait times as of March 2024:

  • Tokyo: 3 days
  • London: 15 days
  • Mexico City: 28 days
  • Mumbai: 543 days

The F-1 visa is a nonimmigrant visa, meaning it only allows the holder to stay in the country during the period of study. On-campus employment is allowed for up to 20 hours per week, but off-campus employment must be approved on a case-by-case basis. According to U.S. Immigration and Customs Enforcement:

An F-1 student must show an ability to afford the costs of school and living expenses before entering the United States and should not plan to work off-campus. U.S. Citizenship and Immigration Services (USCIS) will authorize off-campus employment only in cases of severe economic hardship occurring after a student’s enrollment in an academic program and after the student has been in F-1 status for at least one full academic year, or in emergent circumstances as defined by the Department of Homeland Security (DHS).

This severely limits options for students who wish to work or pursue business opportunities during their period of study under the F-1 visa. And if students wish to continue living in America after graduation, they need to apply for a different kind of visa.

Obtaining an H-1B visa after college

The H-1B visa is another type of nonimmigrant visa that is meant for specialty occupations and requires the employer to file Form I-129, Petition for a Nonimmigrant Worker. It is possible for F-1 students, at the end of their university studies, to switch classification by finding jobs with employers willing to submit this petition on their behalf.

After graduating, F-1 students have only 60 days to maintain their legal status. However, since H-1B visas are not granted until October 1st, this period may be extended so long as the petition has been timely filed and certain other conditions are met.

While an H-1B visa can allow a foreign student to continue living and working in the United States, there are some downsides. One is that there are a limited number of H-1B visas available each year. According to the United States Citizenship and Immigration Services (USCIS):

The H-1B classification has an annual numerical limit (cap) of 65,000 new statuses/visas each fiscal year. An additional 20,000 petitions filed on behalf of beneficiaries with a master’s degree or higher from a U.S. institution of higher education are exempt from the cap. Additionally, H-1B workers who are petitioned for or employed at an institution of higher education or its affiliated or related nonprofit entities, a nonprofit research organization, or a government research organization, are not subject to this numerical cap.

There are generally far more H-1B applicants than there are available visas, meaning whether or not an individual is granted a visa may be left up to luck. The application process can also be long and burdensome, especially if the applicant has to try again each year until they’re lucky enough to land a coveted visa. Students who’ve finished their university studies may have to return to their countries of origin and wait to try again the following year if not awarded a visa on their first try.

Once in the United States, a visa holder is limited to working for the employer who sponsored their application. If they want to switch to a different employer, that employer must file a new petition with USCIS. This can make it difficult for H-1B holders to start small businesses (it can be done, but proving a bona fide employer-employee relationship is complicated) or take advantage of new opportunities that may come along.

H-1B is also not a reliable way to achieve permanent residency. The H-1B visa can allow foreign workers to stay in the country for a maximum of six years at a time. Google famously blindsided its foreign employees with the news that it would be suspending Program Electronic Review Management (PERM) applications for employees seeking green cards, forcing those approaching their six-year deadlines to scramble for solutions.

For those laid-off workers, EB-5 became an attractive method for staying in the country while pursuing permanent residency. Not only can EB-5 give graduating students the chance to pursue permanent residency, but it also offers them greater freedom to pursue their career goals

How EB-5 can benefit students

The EB-5 Program was enhanced greatly with the passage of the EB-5 Reform and Integrity Act of 2022 (RIA), which instituted new protections for investors, reserved visa categories, and other helpful provisions. For students, the golden ticket was the option for concurrent filing for Adjustment of Status applications.

After making an EB-5 investment, investors must submit an I-526 or I-526E petition. When they do, they can concurrently file Form I-485 for Adjustment of Status, along with Form I-765 for work authorization. This means applicants can stay in the country and work while awaiting adjudication of their petitions. That includes students, who may be able to pursue off-campus jobs or internships.

Work authorization also means applicants aren’t tied to a single company. They can work for anyone, including freelancing or starting their own small businesses. And there’s no need to rely on H-1B lottery draws or apply for other non-immigrant visas that have limited residency periods.

“There is no doubt that moving from F-1 to Green Card through the EB-5 Program can make a foreign student’s life significantly easier, not having to worry about OPT [Optional Practical Training] and employer sponsorship post-graduation,” said Joey Barnett of WR Immigration. “We expect to see a huge demand for EB-5 from foreign students inside the United States.”

Students don’t need to wait for the end of their academic journeys to begin pursuing EB-5 or receiving the benefits EB-5 provides. While graduating university students may choose to file their own EB-5 petitions, additional benefits are available to students who relocate to the U.S. before college due to a parent’s EB-5 petition. If the student has already relocated to the U.S., they can obtain U.S. residency, potentially opening the doors to in-state tuition rates as well as eligibility for federal loans, grants, and scholarships.

While EB-5 does require a significant investment on the part of students and their families, the benefits are worth it to many immigrants, especially those hoping to move their entire families to the U.S. in pursuit of a new life.

“Families sending their children to the U.S. to study have already invested so much in their education,” said CanAm Investor Services CEO Peter Calabrese in Financial Express. “An EB5 visa helps maximize the return on that investment and more importantly, allows their children the opportunity to achieve the best they can.”

Choosing the right EB-5 investment

The specifics of an individual’s EB-5 journey may vary based upon who the applicant is (the student or the parent), but the basics are the same: the first thing required is an at-risk investment in an approved project. Investors must evaluate the project and feel comfortable making the investment, not only based on the potential success of the project, but also for the likelihood of a successful immigration petition.

Applicants from countries like China and India have been burdened with protracted processing times due to retrogression. Thanks to the RIA, those wait times can be slashed for investors participating in EB-5 projects that fall into the new reserved categories, like those in rural areas. Getting as much information as possible is crucial, as is working with an experienced team that understands the complexities of EB-5.

JTC works with issuers and Regional Centers to provide security measures that help protect investor funds, compliance tools to support adherence to EB-5 rules, and transparency through a 24/7 online platform that allows investors to view progress and access important documents at any time. Thanks to our global presence and broadened service offerings, JTC can assist immigrant investors with the transition to the U.S by offering Private Client Services designed to protect and nurture their capital in real estate and both financial and non-financial assets across countries and generations. JTC has many ways to aid those looking to make a big change.

To learn more about JTC’s EB-5 services.

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