The requirements of the E2 Visa investment can be confusing. One question that often comes up is “what expenditures can I count as an investment?”
In this post, I am going to cover the most common types of expenditures that count towards your investment total for the E2 Visa.
A Few Words About Commitment & The E2 Visa Investment
Before I dive into what counts, you should understand that your E2 Visa Investment funds must be committed to the business before you apply. This is scary because you could spend a lot of money only to have your E2 Visa Application denied. In order to avoid that scenario, a lot of E2 Visa Investors want to hedge. They hold back. They are reluctant to spend their money on the business.
While this is a natural inclination, the E2 Visa Investor should know that the more that you commit to the business, the more likely an approval becomes. Money that is spent or fully committed counts as an investment. Money that is sitting idly in your US bank account does not.
Deciding How to Spend Your Money
Once you have money to invest, you will want to know how to spend it. You can decide how to spend your money by thinking about everything that you need for the business. What will you need to have in place on day one? Once you have that answer, you can start to spend on all of the things that you will need to run your business.
Expenditures on Professionals
Oftentimes, towards the beginning of your E2 Visa journey, you will hire some professionals. You will use a business lawyer to negotiate on your behalf and create your business entity. Accountants should be hired to help you to understand the tax implications of opening a US business. You will also work with an E2 Visa Lawyer and a business plan writer. The money that you spend on these professionals will count towards your E2 Visa investment.
Equipment and Real Estate Expenses
It probably seems obvious that equipment that you purchase for your business counts as an investment. However, a lot of people do not realize that you can also count previously purchased property that is transferred to the US. For example, let’s say that you have a work vehicle in your home country that is being used in a similar business. You could transfer that vehicle to the US for business purposes. Then, you could count it as part of your E2 Visa investment.
In addition to equipment, you may need a physical location to operate your business. If so, you can count your real estate expenses. In the event that you are renting your space, you can consider paying rent in advance to increase your investment total.
The Purchase Price and/or Franchise Fees
This is not a shocker, but the price paid for the business will count as an investment. And, if you are buying a franchise, the franchise fee counts as well.
Since these expenditures usually make up the bulk of the E2 Visa investment, a lot of people are nervous about committing this money before the E2 Visa is issued. If you are apprehensive about potentially losing this money, you can consider putting the purchase price or franchise fee in escrow. Money that is held in escrow can be considered committed funds as long as the issuance of the E2 Visa is the only condition of the escrow agreement.
Expenditures on Personnel
Once you set up your business, you may be ready to open your doors before you have your E2 Visa in hand. If you are in this position, you could hire employees to operate the business since you will not be permitted to do any hands on work at this point.
Having employees in place is beneficial to the E2 visa application process for multiple reasons. First, it shows the adjudicator that the E2 enterprise is real. It also shows that the business will create job opportunities for US workers. And as a final bonus, the money that you pay employees can be counted towards your investment.
Conclusion: Expenditures for the E2 Visa Investment
To summarize, any money that is spent to start or run the US business can be counted as an E2 visa investment. Additionally, previous purchases and money held in escrow can count in some circumstances. In order to gain a deeper understanding of the process, it is important to discuss your plans with a knowledgeable business immigration lawyer. Working with an immigration lawyer will give you confidence, help you avoid problems and free you up to focus on your new business. Good luck on your E2 journey!