International Entrepreneur Rule
federalregister.gov
federalregister.gov
Looks like you can also get an additional 30 months by raising a further $500k, or having at least $500k ARR with 20% annual growth, or employing 5 US persons full time. You need to maintain a 5% stake and continue to serve a central role in operations in order to qualify for the additional 30 months.
The investment has to be raised from investors with a track record of investing in high growth startups.
This will come into force from July 17 2017.
The typical immigrant investor was not starting Google, a genomics lab, a 3D printing business, or anything even vaguely innovative.
(Do they need to pass the point-based qualification as well to get the visa in the first place?)
For the US, small business investor-entrepreneurs typically use an E-2 visa but it is non-immigrant and they need to leave the country when the business stops operating.
The US International Entrepreneur Rule is more like the "Start Up Visa" [1] that was introduced in Canada a few years ago, which allows entry for founders of a business supported by local venture capital or incubators (subject to certain monetary amounts and conditions).
A major difference: the Canadian start-up visa gives immediate permanent residence, rather than a number of years of temporary status with no guaranteed route forward.
[1] http://www.cic.gc.ca/english/immigrate/business/start-up/
You are also free to apply for other visas while in the US without affecting your parole.
Company "invests" 250k into a "startup" who's only job is to "consult" with the parent investor company.
BAM! You've just hired 3 engineers right there, who have completely skipped the greencard line.
What on Earth are you talking about? That $100K threshold is designed to target body shops.
There are a class of employers which are H-1B dependent; generally, those with at least 15% of their employees on the visa. Currently, H-1Bs with a salary of at least $60K are not counted toward that 15%. The bill will change this to $100K salary.
It is possible to hire a H-1B for $50k under the current laws if that is market rate for the relevant position.
They've always done this and always will.
Political measures don't need to be absolutely effective to be useful. Raising the difficulty might be enough to deter a large number of fraudulent applications.
> investors with established records of successful investments
The rich get richer. Established investors get cheap labor, while upstart competitive investors get buried behind an artificial government wall. I wonder if any established investment firms lobbied for that?
"Successful investments" can be validated with a reasonable argument, so it actually opens door for younger VCs.
But maybe not. Just throwing it out there.
Having dealt with this situation recently, I'm a little more sympathetic to the government's position.
Most investors are dumb. Really dumb. No, dumber than that.
It's really easy for a con man to set up shop. It takes forever to get him shut down, and the scammed will fight you.
Scammed investors will defend the scammer even when you present them with incontrovertible proof. You can stand in court and have a judge hand down rulings of the level of "worst case I have seen" and they will STILL defend him.
Preventing these kinds of "investors" from even getting into the game is really the only way to keep it under control.
Trump being elected was hardly a surprise to me given my recent experiences with dumb investors.
Handing your savings to a con man affects more than just yourself. It destroys your family, which increases crime, etc.
No one person wants to be constrained, but en masse these kinds of things can destroy a society. Especially when they are well-known cognitive exploits that work on people despite their own stated preferences.
So by your logic, it should be illegal to get conned. Let's punish victims. Seems pretty backwards to me, even though your goal is to be proactive. Might as well outlaw suicide while we're at it.
> but en masse these kinds of things can destroy a society
An example might be good here to back up a pretty questionable claim.
That really isn't what they said...
I hear the same arguments all the time about protecting people from themselves. The argument typically goes "well it doesn't just affect you; your decisions could impact people who depend on you, so we'll add a 'protection' that may prevent you from harming yourself and your dependents." If it is acknowledged that it is indeed the decisions of the actor which affects his dependents, not the dangers of the world that may tempt the actor, and you want to protect his family from his own ineptitude through government force, then it sounds like you would have to make it illegal for that actor to make mistakes/get conned.
But of course, the whole 'protect people from themselves' argument is flawed long before that point, because it assumes that the government can and should try to create a world without risk. This is clearly impossible and subjective, and for the government to even come close, it would have to become so oppressive as to reduce freedoms to nothing. The same exact logic is used for keeping marijuana illegal, which I would speculate many of the dissidents on this thread do not support.
So in our current system, for example, we have rich people who get to use hedge funds (of which some very very low percentage turn out to be a Bernie Madoff-type of a scheme) and poor people who are protected from themselves and get to enjoy the Fed's ultra-low interest rates as inflation eats away at their savings. Clearly not a very good solution.
Maybe a better system would allow all people to use hedge funds, and instead we could focus on preventing/prosecuting fraud.
A civil war should be enough, no?
From your own article, sounds like the problem was corrupt government, not a government that protected and prosecuted fraud.
The problem is that the the person carrying out the scam is playing with "house money" while the ones trying to stop him are paying cash. He is paying lawyers with the money from the investors and burning up the assets. So, by the time you are done, it may be a Pyrrhic victory.
Not only do I dislike the freedom limitations in principle, but I've been giving everyone the benefit of the doubt that limiting freedoms will actually prevent the targeted type of scams. In reality, scammers will always find a way, criminals are not bound by laws, and we're still stuck with the inherent flaws of only giving the rich access to wealth-generating funds.
This is needlessly flame-baitey
> The Attorney General may, except as provided in subparagraph (B) or in section 1184(f) of this title, in his discretion parole into the United States temporarily under such conditions as he may prescribe only on a case-by-case basis for urgent humanitarian reasons or significant public benefit any alien applying for admission to the United States, but such parole of such alien shall not be regarded as an admission of the alien and when the purposes of such parole shall, in the opinion of the Attorney General, have been served the alien shall forthwith return or be returned to the custody from which he was paroled and thereafter his case shall continue to be dealt with in the same manner as that of any other applicant for admission to the United States.
[0]: https://www.gpo.gov/fdsys/pkg/USCODE-2015-title8/html/USCODE...
E-2 visa for some nationals requires the person to reapply for the visa if one travels outside the US and wants to get back in, which is a major pain point. (There is a period, for example 6 months or 1 year, when the re-entry is permitted without re-application. This varies with the country.)
However, I just found this paragraph on www.uscis.gov:
"An E-2 nonimmigrant who travels abroad may generally be granted an automatic two-year period of readmission when returning to the United States. It is generally not necessary to file a new Form I-129 with USCIS in this situation."
So I guess one may want to re-check to be very sure if one wants to get an E-2. I'm going to apply for the Entrepreneur Parole since it fits my situation much better.
The durations may vary depending on the country the visa is issued from (due to the underlying treaty), and the status associated to it: in my case France as an essential employee (NOT as an investor).
Being an American taxpayer is fine and dandy if you never plan to live outside the us again; but if you aren't, it's a very expensive and labour intensive deal; your home country bank will fire you as a customer because of FATCA, the reporting requirements to the us are insane (FBAR and every single foreign transaction needs to be reported), and your e.g. Pension savings and other holdings likely become a losing proposition because they are PFICs.
Most people ignore these issues, but almost everyone is liable under the us tax code, and especially with the just announced sharing of NSA data with the IRS, it will all be legally documented for the IRS to pursue.
That's unless if you have more than 5 years of a banking relationship, but then you wouldn't qualify for this rule anyway.
You may be thinking of the rule requiring American citizens to pay taxes over their worldwide income, not only their US income. That rule applies to American citizens as well as permanent residents ("green-card holders"), but generally not to anyone in the US on a temporary visa. That means that someone in the US on a temporary visa will generally be paying US taxes over any income from a job or business they have in the US, but if they have, e.g., income from renting out real estate in another country, that income may be taxed in that other country, but not in the US. Only US citizens and permanent residents are required to report any such foreign income in the US and pay taxes over it, even when they move abroad (with some exemptions).
FATCA is not as onerous as you describe for most regular people. As a US taxpayer (whether a citizen or permanent or temporary resident), you have to report foreign bank accounts that at any point during the year contain more than the equivalent of something like $10,000. That's it. There is no requirement (as far as I'm aware) to report "every single foreign transaction."
You're right that retirement planning can be complicated for immigrants and temporary visitors. Many countries have rules like the US, where you have to pay into the system for a certain number of years before you become eligible for social-security payments in old age. So for many immigrants retirement becomes a patchwork of sources (a bit of social security, a bit of foreign social security, and otherwise savings in whatever accounts are available in the US and abroad.)
It is indeed what I'm thinking about, but I believe you are wrong about the "temporary visa" thing - As far as I know, only F and J visas (inherently temporary) are exempt; H-1B, L-1, E-1, O and K visas which are temporary in the sense that they expire on job termination / divorce, but they still subject you to taxation of your worldwide income.
> There is no requirement (as far as I'm aware) to report "every single foreign transaction."
There is a requirement to report the details of every transaction that has capital gains and losses associated with it, if that transaction did not happen in the US.
A few years back, I got a call from my foreign bank one day, saying that because I was a US taxpayer (for several years, at that point, well documented with the bank), they could no longer maintain any of my accounts other than checking and saving. At that point, my bank was also my broker keeping some long term bonds, stocks, mutual funds, etc. So, they had me choose whether I want to transfer them to a SEC-regulated bank/broker (impossible - non had the facilities), or liquidate them -- which is what I did.
Had this been done in the US, I would just have to report aggregate capital gains/losses. and that's it. However, as this was outside the US, I had to fill a 2-page form describing every liquidation transaction that the bank did. I ended up filing north of 300 pages that year. "Luckily", now I can't purchase any of these securities so that won't happen again, except ....
> You're right that retirement planning can be complicated for immigrants and temporary visitors.
No, I'm not talking about retirement planning, which is indeed complicated.
Almost every country has a pension saving system independent of the social-security (or equivalent) system. In the US, for example, it is IRAs and 401K. These things get preferential tax treatments, usually "no tax (up to some limit) as long as you only cash it when you retire". However, the US does not recognize any other country's preferred retirement saving. Those savings are in 99% of the cases, a PFIC from the perspective of the US tax system.
Which leaves you with three choices: Either cash it, retroactively forfeiting any tax benefit (possibly 20 years of it), and move it to a US equivalent; Or .. pay a tax each year on the theoretical profit of those pension accounts ... or, pay a lump compounded interest-and-penalty tax the day you actually cash it, which will likely be 50%-100% of that sum.
Now, if you've moved to the US for good, then, by all means, you have to take the hit to switch systems. However, if you can't guarantee that you can stay forever, all your options regarding taxation of your pension saving are awful.
This is not completely true: Canadian RRSPs are recognized by the IRS at the federal level due to a tax treaty, though may not be recognized by all states. (For example, I had to figure the interest on the investments for my California return, until I decided to sell the RRSPs to simplify my life.) Other countries may get special treatment for their tax-deferred retirement accounts via a tax treaty too, though it can be tricky to ascertain -- you may end up actually having to read the treaty!
If you do have "american taxpayer" status, banks outside the US (essentially all of them these days) will refuse to let you do anything other than keep a checking and saving account, and brokers will refuse to do business with you, thanks to SEC regulations that say that only SEC regulated brokers and banks can handle securities on behalf of US taxpayers.
Essentially a red carpet side door if you have a slab of cash.
There is already something like what you are suggesting in the U.S. AFAIK, just $500k or $1M depending on the situation.
It's an attempt to soften the harsh consequences that often arise from these counterintuitive rules in a very technical legal space that is almost impossible to legislatively correct.
For example in late 2000 the US government didn't get around to renewing the "visa waiver" law in time. Rather than suddenly requiring visas from everybody from the former visa waiver countries (and cause travel chaos), passports were stamped "PAROLED" for visa waiver people (mostly tourists) entering until the law was renewed. (I had a stamp like that in October 2000).
However, these visas require that people invest their own money. This visa is different because it allows investment with other people's money. It's a big change.
[1] https://www.uscis.gov/green-card/green-card-through-job/gree...
All this means in reality is that once you've come to the US and established the basis for another visa, your "intent" changes and you apply for an applicable immigration visa. People do every year with both the F-1 and the E-2 visa.
However, some people prefer to reside in the US long term with non immigration status. The E-2 allows people to emigrate to the US and remain there, indefinitely renewing their E-2 visa, whilst (i) protecting their future non-US tax status, and (2) entering and exiting the US for long periods of time (as long as the business is operating successfully). This contrasts with a green card, which (i) subjects green card holders to "citizen-like" tax obligations after a specified period of time and (ii) typically requires continuous residence in the US.
The continuous presence restriction would lift upon receipt of citizenship but not everyone wants (or is able) to hold dual citizenships.
An E-2 is just fine for many rich people.
The EB-5 is a huge site for immigration fraud and in many cases it functions as a green card-for-cash exchange. In fact, the poor foreign investors who didn't understand this are now suing state governments and associated companies because they received no returns from their investment.[1]
[1] http://www.forbes.com/sites/ellensheng/2016/08/01/foreign-in...
Google "EB-5 fraud" for many many more cases but note that, unlike in most immigration cases, the fraud here is being perpetrated against the visa applicants, not the immigration service. There is no suggestion that they do not have the capital or that they have not received a visa, just that there are no returns.
The rich pay almost all tax.
http://taxfoundation.org/article/summary-latest-federal-inco... Shows the top 50% paying nearly all the taxes. That is a far cry from the rich.
So as a simple-language summary we might all agree that the rich pay a majority of the taxes, while the richer half of the country pays nearly all the taxes.
Note that the "richer half" starts at the median income. For the US, the median income is about $52k. That isn't particularly wealthy. When the bar for "nearly all the wealth" is set at that point, it is not surprising at all.
"The average American household of 2.64 people receives almost $13,000 worth of federal benefits, services, and protection per annum. These people would have to have a family income of $53,700 to pay as much in taxes as they get in goodies... Only 4.8 percent of the population -- 12,228,000 people -- file income tax returns showing more than $50,000 in adjusted gross income. Ninety-five percent of Americans are on the mooch." -- P. J. O'Rourke [1]
They may pay a lower percentage of taxes on wealth gains than middle class or upper middle class, due to being able to delay income realization, lower capital gains taxes, and other means that are more accessible to the rich than the middle class or the poor.
But rich people still tend to pay more taxes than less rich people.
Spend 15 minutes talking to an accountant on the premise that you don't want to pay any tax. If you've got enough cash, that's not a problem, anywhere in the World.
I don't have even the vaguest idea of policy in this (although I'm sure there's some research I can read up on), but I think something can be done, whether via some kind of redistribution scheme, regulation, etc. to attempt to mitigate these effects by redistributing aggregate gains to those hurt hard. I watched many people develop virulent xenophobia and racism because of the issues of undocumented labor and improperly managed migration. I wish in addition to free trade treaties we could have free movement treaties without having to form some pseudo federation like the EU.
You can immediately become Canadian permanent resident by merely LOANING the province of Quebec $800K for five years. At current interest rates your actual monetary loss would be ~$80K.
You don't even need any qualifications. You don't even need to live in Quebec afterwards, you're free to move anywhere.
Oh and you can become Canadian citizen after three years of living in Canada, although because Canada does not reliably track people at its borders you can just fake passport stamps and other stuff. Recent revelations showed that people have been doing that at massive scale.
So you get 60 months and then have to leave the country? How is that attractive?
it is post-dated next tuesday, I didn't know could post-date a rule
Federal law says rulemaking isn't valid until 180 days have passed so it kicks in July 17.
All of these rules are to keep federal agencies from changing the rules out from under people, and to give Congress/Courts time to act.
entrepreneurs already can request a visa in their home country usa embassy.
why the people validating documents at the airport should now decide on startups sounds crazy at least.