E2 Visa: What Does “Marginal” Business Mean?
What is the definition of “marginal” business?
Jane Smithsonian decided to come to the U.S. from Norway to open a bakery. Although she was not rich by any means, she decided to use some money that she saved, along with a monetary gift from her parents, to partake in her new business venture. Looking into her visa options, she decided upon the E-2 visa program. This program, as Jane found out, allowed her to invest within her business, maintain significant control of its operations and provided her with a two year visa to establish herself and her business within the United States. Within two years, Jane was able to firmly plant her bakery in the Mid-west. Unlike many businesses that were unable to recover from the major economic crisis that was happening across America, Jane’s bakery withstood the test of time. Jane understood the importance of keeping her investment above the margin and made smart choices concerning her invest options as the business began to flourish.
Falling under the cloak of marginality can be a disaster for foreign investors with approved E-2 visas. As a foreign investor with E-2 visa status you must:
Have invested or is actively in the process of investing a substantial amount of capital in a bona fide enterprise in the United States, as distinct from a relatively small amount of capital in a marginal enterprise solely for the purpose of earning a living. The last part of this section is crucial. You will be in jeopardy of losing your E-2 visa status if it is shown that your business, at any point, is solely being used to support you and your family’s standard of living within the U.S. and is not producing a significant economic contribution.
How not to loose your E-2 Visa?
As an investor with an E-2 visa, it is your responsibility to keep accurate financial records of the state of the business, should a consulate or immigration officer inquire about the financial state of the business. Hiring a certified public accountant or experience bookkeeper is advisable if you are unable to keep track of this information yourself. Another great option is to develop a strong business plan. In the event you are unable to show that the business is currently producing a significant economic contribution, your business plan can be used to show that it is headed in that direction within the next five years.
Although many businesses have been closed due to falling under the cloak of marginality, there are still many businesses, like Jane’s, who set up a strong foundation and were able to provide evidence of significant economic contribution with their business. Remember that obtaining the visa is just the first step of the process and maintain the requirements in crucial to your visa status and the business enterprise.
For more information regarding the E-2 visa program click here.
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Author: Maurica John