What Types of Businesses Are Eligible for the E-2 Visa and What Are the Tax Implications?

The E-2 visa is a popular non-immigrant visa that allows foreign entrepreneurs to invest in and manage a business enterprise in the United States. However, what types of businesses are eligible for the E-2 visa and what are the tax implications?

Entrepreneurs who wish to obtain an e2 visa business ideas can either start a new enterprise or purchase an existing one. In either case, the investment must be considered substantial, and the enterprise must be an active for-profit business that is capable of generating sufficient income to support the investor and his or her family.

To determine the amount of capital required to meet the substantial investment requirement, USCIS looks at a number of different factors. The first and most important is that the investment must be "at risk." In other words, the entrepreneur must have real skin in the game. This means that the entrepreneur must have at least $100,000 in the business, which is not an insignificant amount.

Additionally, the investment must be made in an active for-profit enterprise, such as a restaurant or a retail store. The enterprise must also be a "capital" business, meaning that it has the potential to generate significant revenue. It is important for entrepreneurs to discuss the potential for significant revenue with an experienced attorney when considering a business venture.

Franchises are another excellent option for E-2 entrepreneurs, as they typically require a much smaller initial investment than a standalone business. The other benefit is that the franchisor will provide support and guidance to help the franchisee succeed in the business.

As a final note, it is important for any E-2 entrepreneur to understand that the visa is intended to be temporary and that they must have plans to return to their home country once their business venture is completed. As such, it is important for entrepreneurs to carefully consider the potential tax implications of their investments and consult with an experienced attorney who specializes in international taxation.

E2 visa holders have a few options for the structure of their business, including an LLC or C Corporation. Choosing the right entity is critical, as it can impact how taxes are incurred and whether or not the entrepreneur has personal liability protection.

Whether an entrepreneur opts for an LLC or C Corp, it is important to consult with an attorney regarding the specific treaty between their country of origin and the United States in order to ensure compliance. An attorney who specializes in E-2 visas can assist a client with every step of the process, from determining which type of company to register and establishing the appropriate capital requirements.

The E-2 visa is a great way for foreign entrepreneurs to realize their dreams of starting a business in the United States. The visa is flexible, with no minimum investment or requirement for employees. If you are interested in learning more about the E-2 visa or how to start a business in the United States, contact Dan Fowler today.