Sometime in 1990, the United States Congress enacted a law aimed at boosting the US economy and bringing down unemployment by creating or saving at least 10 full-time jobs. Known as EB5, this Immigrant Investor Program, aside from offering tax incentives, allowed foreigners an opportunity to become a conditional resident of the US for 2 years, much like having the status of a conditional green card holder.
How Does It Work?
If you’re a foreign investor, you would be required to put in an investment of US $1,000,000. But, a minimum of US $500,000 is also acceptable should you decide to make the investment in any “Designated Target Employment Areas”. These are defined as rural areas outside of a city or high unemployment areas or if the investment is made through a designated EB5 Regional Center.
Puerto Rico is a Target Employment Area, ergo the projects offered via the Caribbean EB5 Regional Center requires only US $500,000 investment from any interested foreign investor.
When this requirement is met, you, as an investor is granted a conditional Green Card. It’s conditionality, however is removed once the 10 job requirement is satisfied. Your status then converts into permanent residency or that of a green card holder with no conditions attached.
After 5 years under this status, you may apply for US citizenship. There is no obligation to remain in the United States on a continuous basis as requirement for citizenship. You would be free to travel but your US residence should be maintained during this time.
In your EB5 application relative to your US $500,000 investment, you may include your wife and children under the age of 21. In actuality, this lesser-known way to permanent residency in the US or Puerto Rico is readily available to immigrant investors. This EB5 classification is allotted ten thousand (10,000) visas every year.
The Tax Incentives
With Puerto Rico’s Act 22 (Act to Promote the Transfer of Investors to Puerto Rico) which provides tax exemption on income derived from investments of non-resident investors, complemented by the authority of Puerto Rico’s Economic Development Administration to designate Targeted Employment Areas, the EB5 should prove to be an attractive business come-on for foreign investors.