How do I prove the legal source of my funds?
In order to prove investment funds come from legitimate sources, the investor must trace back the US$500,000 from the beginning to the final destination (the Regional Center). Below is a simplified example of the paper trail of documents that should be provided for funds that were obtained through a property sale:
- Bank statement extract showing transfer of US$500,000 from personal bank account XYZ to Regional Center;
- Bank statement extract showing US$500,000 transferred from buyer account ABC to personal account XYZ;
- Final sales contract of property for US$500,000;
- Purchase agreement and title deed of property when it was initially purchased 10 years ago for US$200,000;
- Income tax documents from years prior to purchasing property confirming salary of US$70,000 per year, and accompanying bank statements showing US$50,000 savings per year (4*50,000 = 200,000)
My net worth is over US$1 million. Do I have to prove the legal source of my total net worth?
No. Unlike the Quebec Immigrant Investor Program (QIIP) where you have to prove the totality of your net worth regardless of how high it is, for the US EB-5 program, you only need to prove the lawful source of the funds used for your investment, ie, the US$500,000 invested in the Regional Center. Any net worth above and beyond the investment amount will not be verified for the purpose of this program.
I don’t have sufficient funds on my own. Can the funds I use for investment be gifted?
Yes, gifted funds are acceptable to use as part of your investment, or even the whole investment amount. The gift must be legally-executed by gift deed and must be a genuine gift of which you have lawful title without condition. In other words, the funds cannot be a loan. Note that the legal source of the donor’s funds must also be documented.
Is there a holding period on funds received by gift?
Gifted funds can be used for the investment immediately. The QIIP requires that gifts be received at least six months prior to submission, otherwise the funds are deemed ineligible.
Proving the lawful source of investment funds can be done with many different types of documentation. Preparing the full application package is best served with the guidance and representation of a reliable immigration consultant or attorney. The experienced team at our firm can help you review all possible sources of funds, as well as recommend the best information and documentation to use to authenticate them. EB-5 guidance is at your fingertips. Contact our office today.
For more information on the U.S. EB-5 prgoram, please click here.
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