Why Invest In EB-5 For A Child?

There is no regulation in the EB-5 Program that prohibits minors from becoming EB-5 applicant investors. Why invest in EB-5 for a child?

Parents from Mainland China are deciding to invest in EB-5 for a child and here's why.

For several months now the backlog of Mainland China born applicants has remained the same. When that happens parents begin to worry that their children will age out of the EB-5 Program. Parents want their children to obtain an U.S. green card so that they can live, work, and go to school in the U.S.

Aging out occurs when a child turns 21 during the EB-5 application process. Therefore, many concerned parents of children who are a couple years from turning 21 years of age, are deciding to have their child apply for EB-5 status on their own.

How can parents invest in EB-5 for a child? Parents will most likely need to take two steps.

The first step is to gift their child the minimum investment amount, either $1,000,000 or $500,000.

  • The money must be placed in an account under the child's name. The parents will then need to provide USCIS with documents proving that the funds for this gift were obtained through lawful means.

The second step, if the child is also a minor, is to sign an EB-5 project contract on behalf of their minor children.

  • Under the Uniform Gifts to Minors Act, a parent can enter into a contract on the behalf of their minor child. This is important because in the U.S. a contract that a minor enters into can potentially be voided when that minor turns 18 years of age and an EB-5 contract must not be voidable. By having the parent sign on the child's behalf that contract then is not voidable.

Two important points to note:

  1. Although the parent is signing for their minor child, they do not, in any way, become the owner or investor of the enterprise they're investing in. They may have to handle the investment on their child's behalf until they are legally adults, but they do not any stake in the investment.
  2. Issues may arise when working with a minor child. When a minor child tries to transfer the funds to the project, they may have trouble going through escrow as a minor. They also may have problems when it comes to finding an EB-5 investment project. A regional center or development team may be wary of taking on the investment of a very young child.
For questions pertaining to your particular EB-5 case, consult an experienced EB-5 immigration attorney.



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