The E-2 visa is an excellent choice for certain foreign nationals who want to live and work in the United States. The E-2 visa permits foreign nationals to start or buy a business in the United States and work for the E-2 company. They may bring their spouse and children, and a spouse in E-2 status may apply for work authorization once in the United States. The E-2 visa are typically issued for five years and may be renewed indefinitely as long as the applicant continues to work for the E-2 company and the E-2 company remains operational and hires U.S. employees. For more information on the E-2 Visa, please click here.
The first step to applying for an E-2 visa is determining what type of business you will establish as your E-2 company. Immigration law does not dictate a specific type of industry that qualifies for the visa, so your options are quite vast. We have had clients file successful E-2 applications for many different types of businesses, from a software development company to a yoga studio. The key thing to keep in mind is that the business must satisfy specific requirements to qualify for the E-2 visa. One of these requirements is that the applicant must show that the E-2 business is a “real and operating” enterprise as defined by immigration law.
E-2 applications for real estate companies often receive increased scrutiny, as various business models that are typical in the real estate industry would fail to demonstrate that it is a real and operating enterprise. Instead, they are often viewed as too passive. This post will discuss the types of real estate businesses that would qualify for an E-2 visa.
Real Estate Companies in the E-2 Context
The E-2 regulations require that the enterprise must be a real and active commercial or entrepreneurial undertaking, producing some service or commodity. Various types of real estate companies, such as real estate holding companies, do not qualify for the E-2 visa, as the government would consider such companies “idle speculative investments held for potential appreciate in value.” The FAM specifically identifies assets such as “undeveloped land or stocks held by an investor without the intent to direct the enterprise.”
Thus, purchasing property in the name of an LLC will not qualify for an E-2 visa. Similarly, placing your stock portfolio in the name of an LLC as an E-2 investment will not qualify for the visa, as these businesses are not sufficiently active to qualify for the visa. For more information on the meaning of a real and operating enterprise in the E-2 context, please click here.
E-2 Qualifying Real Estate Companies
While asset holding companies are out of the question due to their passive nature, there are several types of real estate businesses that would qualify for an E-2 visa. Below is a list of Real Estate companies that would qualify for the visa. Please note that this is not a complete list of E-2 compliant companies, but rather an example of successful Real Estate businesses our clients have founded and run as E-2 companies.
Real Estate Brokerage Firm: A real estate broker can start a real estate agency as an E-2 enterprise. The key is that the company is providing a service (property listing and securing tenants for their clients) and therefore is a real and active commercial enterprise. It is important to note that ideally an E-2 real estate agency should hire employees prior to applying, and have a comprehensive business plan with a thorough personnel plan to demonstrate how the company will hire more employees and not be marginal.
Real Estate Management Company: An investor can start a real estate management company and this may work for the E-2 visa. It is important that the company should manage more than just the investor’s own properties before applying for the visa. For example, if an E-2 applicant starts a real estate management company and the only property they manage is their own condo or house, this will likely not be approved. Alternatively, if the applicant owns two buildings with 200 units or has multiple homes (eg. Close to 50), these would be stronger cases as there is clearly enough work for the company to hire U.S. workers. The applicant should strive to get third party property owners as clients prior to applying, as this demonstrates that the company is active in the local real estate market.
Real Estate Renovation/Construction Company Another type of real estate business that could qualify for an E-2 business is a home renovation/construction company. It should be noted that this type of business model is different from a house flipping company, which would only qualify for an E-2 visa if the applicant had a large inventory of homes. This business is hired by property owners to renovate or work on their homes, and thus provides a service and is an active enterprise under the regulations.
House Flipping Business
This could work for an E-2 visa but the investor would have to own a large number of properties such that the business was active enough to hire employees. This type of business is often viewed as too passive but if one has say 50 properties, which would require several full-time employees to operate, the management of the business could qualify for an E-2 visa.
Scott Legal, P.C. has filed hundreds of successful E-2 cases including dozens of real estate companies. It is important to work with a qualified immigration attorney when applying for an E-2 visa.
To find out more about investor visas, contact Scott Legal, P.C.
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