Immigration Strategies: E-2 Visa & EB-5 Visa

Updated: June 18, 2024

WRITTEN BY

EB-5 Insider Team

A group of professionals with years of experience helping people immigrate to the US

Note: This article is for informational purposes only. We are not providing legal advice or selling securities. The articles and content on this site are of a general informational nature only and should not be relied upon for individual circumstances.

If you’re considering immigrating to the United States as an entrepreneur, you’ll come across the E-2 visa and EB-5 visa. These are ideal options and appear similar at first glance, but they are two different programs. While both visas allow you to work in the U.S. after investing, they suit different types of immigration goals and individuals.

The E-2 Non-Immigrant Treaty Investor Visa is often considered to have been influenced by the EB-5 Immigrant Investor Program. They both offer residency status for immigrants based on investment. An E-2 has been seen as a stepping stone to acquiring a green card. It’s possible to transition an E-2 visa to the EB-5 program to acquire permanent residency status. Thus, it is common to see investors use the E-2 visa as a bridge to EB-5, especially if concurrent filing is not an option.

We’re discussing everything you need to know about the E-2 visa, how it compares to the EB-5 visa, and how to transition from an E-2 to EB-5 visa.

What is the E-2 Visa?

An E-2 Business Visa is a non-immigrant visa that enables foreign nationals to enter the United States after investing substantial funds in a U.S. business, franchise, or new business.

These foreign nationals must be citizens of countries with a commerce treaty or qualifying international agreement with the United States. Foreign nationals from 80 countries can obtain an E-2 Treaty Investor visa. Unlike an EB-5 visa, the E-2 visa does not provide a path to a U.S. green card. Dependent children can only rely on their parents’ visa until they are 21 years old.

An E-2 visa is valid for up to 5 years, depending on the investor’s country of citizenship. Extensions are granted in two-year increments, so long as the investor continues to operate their business. However, they must apply for visa renewal to travel internationally.

Comparing E-2 Visa vs. EB-5 Visa

There are seven main differences between the E-2 visa and the EB-5 visa. Potential investors should consider their circumstances to determine which visa better suits their needs.

Immigrant vs. Non-Immigrant Visa

The E-2 visa is a temporary non-immigrant visa that does not offer a path to obtaining a green card. By comparison, the EB-5 visa is a migrant visa that results in the applicant receiving a permanent green card to become a lawful permanent resident. If an investor on an E-2 visa wants to acquire a green card, they’ll need to adjust their status to an immigrant visa status. Furthermore, considering you cannot receive permanent residence, this does not provide a pathway to becoming a US citizen.

Some countries, including Brazil, China, India, and Russia, do not have treaties with the United States, so potential investors cannot apply for the E-2 visa. Therefore, if you are from these countries, you must obtain citizenship in a treaty company before applying for an E-2 visa. This will likely come with additional costs and time.

Alternatively, there are no nationality requirements for an EB-5 visa.

Minimum Investment Amount

The minimum investment amount required is one practical difference between the EB-5 and E-2 visas. The EB-5 visa has a defined minimum investment amount of $800,000 for projects in a targeted employment area (TEA) or $1,050,00 for a non-TEA area.

By comparison, the E-2 visa does not have a set minimum investment amount. It requires foreign nationals to make a substantial investment, determined by the nature of the business. In both scenarios, the EB-5 and E-2 investor lose their status if the business fails to meet the requirements of their visa program.

Job Creation

The EB-5 visa requires the foreign national’s investment to create at least 10 full-time jobs for U.S. workers. These jobs must be created, or likely to be created within a reasonable time, for an applicant to receive their permanent green card.

Alternatively, there are no job creation requirements for an E-2 visa. Foreign nationals must show that the business they invest in is not marginal. A marginal business cannot generate enough income to provide a quality standard of living for the E-2 investor and their family.

An E-2 investor must show that the business they’ve invested in can generate enough income to provide for them and their dependents. Conversely, the marginality requirement can be met by proving that your business must recruit U.S. employees.

While E-2 visa applicants can show job creation, it’s only a requirement for the EB-5 visa.

Ability to Work

An EB-5 and E-2 visa enable a foreign national to work in the United States. However, there are subtle but important differences.

With an E-2 visa, you can only work for the business you have invested capital in. You are required to ‘direct and develop’ the business. The investor’s spouse can apply for authorization to work for any company.

Comparatively, an EB-5 visa enables you to work for any company. You’re required to engage in the management of the project or NCE but can work anywhere. While the investor’s spouse can work for any company, they will not count towards the job creation requirement.

Place of Filing

An E-2 visa must be filed directly at the U.S. Embassy or Consulate in the foreign national’s country of birth, country of citizen, or country of residence. By comparison, EB-5 visas are submitted to the USCIS through the foreign national’s U.S. Embassy or Consulate. Alternatively, they can apply for an EB-5 visa from within the U.S. if they have a valid non-immigrant status.

Processing Time

The processing time for EB-5 and E-2 visas varies and depends on several factors. Generally, E-2 visas are processed faster and obtained by either a change of status or visa processing. It typically takes four months to acquire an E-2 visa.

On the other hand, an EB-5 visa is a longer process with more steps involved. When the foreign national processes their Form I-526, they’ll get a 2-year conditional green card. The conditions on this green card can be removed with a Form I-829 submitted 90 days before the expiration date to transition onto a permanent green card.

The USCIS releases monthly visa bullet updates with EB-5 visa priority dates. Most countries currently have no backlog. Recent forms under the EB-5 Investor Program Reform and Integrity Act (RIA) have streamlined the application process and removed bottlenecks.

Remaining in the United States

The EB-5 visa is designed to provide lawful permanent residence for foreign nationals through investment. The investor cannot abandon their permanent residency and should not spend more than 6 months outside the United States at one time. If an investor needs to stay outside of the U.S. for a significant period, they should apply for a re-entry permit.

Taxation Implications

Taxation is one of the main differences between EB-5 and E-2 visas. EB-5 investors are green card holders, meaning they are subject to paying U.S. tax on their worldwide income. Comparatively, E-2 visa holders are not green card holders and can avoid paying U.S. taxes by spending a certain number of days outside the United States.

Benefits of Transitioning from E-2 to EB-5 Visa

The E-2 visa is temporary and does not offer a pathway to permanent residency or citizenship. By comparison, the EB-5 visa provides permanent residency through investment with the option to become a U.S. citizen after five years of having a green card.

For some investors, transitioning from an E-2 to an EB-5 visa is the best solution. The E-2 visa has a faster processing time, enabling investors to relocate to the United States within a few months.

Once in the United States, investors can apply for an EB-5 visa to obtain permanent residency and a path to citizenship. They’ll also benefit from the option of concurrent filing to reduce the processing time for receiving their green card.

Steps to Transition from E-2 to EB-5

While it’s possible to transition from an E-2 to an EB-5 visa, it requires planning and consideration. Foreign investors must be prepared to make the minimum investment of $800,000 and understand the requirements for job creation.

An E-2 visa holder can take steps to speed up the EB-5 process, such as choosing to open their business in a target employment area (TEA) area to meet the investment threshold faster. The investor must also create at least ten full-time jobs for qualified U.S. workers to meet the EB-5 Immigrant Investor Program requirements. We recommend working with an immigration attorney and a business advisor if you plan to transition from an E-2 to an EB-5 visa.

The E-2 visa holder can invest the additional funds required for the EB-5 visa in their business or a separate organization. Alternatively, they can invest in a regional center project. These EB-5 projects are more likely to meet the job creation requirement, as direct and indirect jobs count towards the 10 full-time positions. 

By applying for a reserved visa, you can reduce the time it takes to transition from an E-2 to an EB-5 visa. This involves investing in a rural area, an area of high unemployment, or an infrastructure project.

Gain U.S. Permanent Residence Through Investment

An EB-5 visa is the most efficient way to achieve permanent residency and U.S. citizenship if you have the capital to make the required $800,000 investment. If you’re an E-2 visa holder, you can become a permanent U.S. resident with a path to citizenship by transitioning to an EB-5 visa.

At EB-5 Insider, we simplify your path to U.S. residency and citizenship through investment. We’ll help you obtain a permanent U.S. green card for yourself, your spouse, and any unmarried children under 21 for an investment of $800,000.

Start applying for an EB-5 visa today, or contact our team for more information.

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