{"id":9423,"date":"2020-01-02T18:20:03","date_gmt":"2020-01-02T18:20:03","guid":{"rendered":"https:\/\/jboitnott.com\/?p=9423"},"modified":"2020-06-16T21:24:34","modified_gmt":"2020-06-16T21:24:34","slug":"starting-a-business-as-an-immigrant-to-the-u-s","status":"publish","type":"post","link":"https:\/\/jboitnott.com\/zh\/starting-a-business-as-an-immigrant-to-the-u-s\/","title":{"rendered":"Starting a Business as an Immigrant to the U.S."},"content":{"rendered":"

Many people come to America to fulfill the dream of a better life. They want better access to education, employment, housing, and, at times, improved health care and a more developed infrastructure. Often, immigrant entrepreneurs start businesses<\/a>, work in professional services, retail, restaurants, real estate, technology, healthcare or construction. They sometimes own franchises and small businesses like grocery stores, gas stations and fast food restaurants.<\/p>\n

Beyond helping themselves, many have added to our domestic economic growth as immigrant entrepreneurs. In 2016, the\u00a0National Immigration Forum<\/a>\u00a0found that immigrant-owned businesses employ more than\u00a019 million people<\/strong>\u00a0and\u00a0generate $4.8 trillion<\/strong>\u00a0in revenue.<\/p>\n

This is an increase from the 2013 report backed by\u00a0Harvard<\/a>, which noted that immigrants added $1.6 trillion to the total U.S. gross domestic product (GDP).<\/p>\n

A\u00a0statistical analysis<\/a>\u00a0based on the American Community Survey and the Survey of Small Business Owners concluded that\u00a0immigrants account for approximately 28% of all U.S. small business owners.<\/strong><\/p>\n

Plus, they are two times more likely to become entrepreneurs than native-born people. Even more compelling is research from the\u00a0National Foundation for American Policy<\/a>\u00a0which reported that 55% of the country\u2019s $1 billion startup companies have at least one immigrant founder.<\/p>\n

These\u00a0enormous economic contributions<\/a>\u00a0come at a cost for immigrants who struggle to create these types of small business opportunities. Here\u2019s why…<\/p>\n

Possible, but with challenges<\/h2>\n

If you\u2019re wondering if it\u2019s possible for an immigrant (who is not a permanent resident) to\u00a0start a business<\/a>\u00a0in the U.S., the answer is yes. The statistics above prove that many immigrants are accomplishing these business goals. But, it takes time and patience as immigrants do need to overcome considerable challenges.<\/p>\n

First, unless you\u2019re a permanent resident, there are no visa categories for immigrant entrepreneurs.<\/p>\n

As an immigrant investor, though, it is possible to get an\u00a0EB-5 visa<\/a>. But you\u2019ll need more than $1 million to invest with the ability to hire employees. Unfortunately, that only applies to a very small number of immigrants.<\/p>\n

Despite many in government working on the\u00a0Startup Act<\/a>, the idea of a startup visa is still just that \u2013 an idea.<\/p>\n

On the other hand, foreign nationals can get a visa as a family, student or visitor, and a work permit as a worker for a certain company or project.<\/p>\n

International Entrepreneur Rule and current options<\/h2>\n

Introduced by President Obama late in his second term, the International Entrepreneur Rule (IER) sought to make entrepreneurship accessible to more immigrant founders.<\/p>\n

This rule would have given immigrant founders 2.5 years to scale their companies in the U.S. (and another 2.5 years if companies met growth requirements). The hope was that the IER would help stimulate business opportunity for entrepreneurs wanting to move to the U.S.<\/p>\n

However, the Department of Homeland Security under President Trump fought usage of the IER and plans to rescind it.<\/p>\n

Until further progress happens or other legislation passes, foreign nationals who want to start a company must use the\u00a0existing visa system<\/a>\u00a0to declare their immigration status. This includes the H-1B,\u00a0E-2 treaty investor<\/a>, or EB-5 Investor Program options.<\/p>\n

The type of visa you select has certain criteria. If you have an established business outside of the U.S. that is at least a year old and employs four or more people, then the\u00a0L-1A visa<\/strong>\u00a0is an option.<\/p>\n

If your business is less than 12 months old or has fewer than four employees, then the\u00a0E-2 visa<\/strong>\u00a0is an option. This visa would also be ideal for an immigrant who does not have a business outside of the U.S., but is moving here to start one.<\/p>\n

There\u2019s also the\u00a0O-1 visa<\/strong>\u00a0for an individual or student who can prove they have extraordinary ability or achievement in areas like sciences, arts, education or athletics, which may benefit the U.S.<\/p>\n

Starting a business as a non-resident<\/h2>\n

Immigrant business owners don\u2019t need to have resident status to open a business and\u00a0file taxes<\/a>. Like other small business owners, immigrants should first select a company structure, such as a C corporation that can include resident investors, or a limited partnership structure.<\/p>\n

The next step is to register in a particular state like Delaware that offers flexible corporate rules. For example, Delaware doesn\u2019t require a bank account or local physical address. After picking a state, select a company name and registered agent as well as fill out a certificate of incorporation.<\/p>\n

The process of starting a business also includes getting an Employer Identification Number. You need this for tax purposes, for getting a business license and for opening a bank account.<\/p>\n

There are financial advisors who may also specialize in helping immigrant entrepreneurs complete this part of the startup process.<\/p>\n

Things to remember<\/h2>\n

There\u2019s one main thing to consider about starting and managing a business in the U.S. as a non-permanent resident. It does not come with automatic work privileges. That means a foreign entrepreneur can be a corporate officer or director of a startup or established company.<\/p>\n

However, immigrants cannot work in the U.S. or receive a salary without first getting a work permit. Examples of this include a green card or a special visa issued by the U.S. government. A foreign citizen can still earn profits from their company, but they must pay the proper taxes on those profits.<\/p>\n

Also, they can only receive compensation from a branch of the same company located in their home country. Therefore, an immigrant entrepreneur must make sure they have enough money to support themselves until they get a green card or become a citizen.<\/p>\n

Business resources for immigrant entrepreneurs<\/h2>\n

Starting a business can be a challenge for anyone, especially for someone new to the country and unfamiliar with processes and laws. Fortunately, there are numerous resources available to help immigrant small business owners succeed.<\/p>\n

Sites like the U.S. Small Business Administration focus on helping entrepreneurs\u00a0grow their businesses<\/a>, offering education, financial assistance and templates. Other organizations like\u00a0Immigrant Biz<\/a>\u00a0provide a directory of resource options, including micro-lenders that specifically help immigrants, as well as local loan programs by state for immigrants.<\/p>\n

Venture capital, funding options and loans for immigrants<\/h2>\n

If you don\u2019t have full resident status, you cannot get a social security number (SSN), which is a critical number for opening most bank accounts, getting loans and\u00a0obtaining credit<\/a>.<\/p>\n

While some financial institutions will accept Individual Taxpayer Identification Numbers (ITINs) instead, it\u2019s not a guarantee.<\/p>\n

Another option for funding is\u00a0grants for immigrants<\/a>. These include business development grants for immigrants who have small businesses but are socially or economically disadvantaged.<\/p>\n

The Department of Health and Human Services provides discretionary grants focused on financial literacy. They also offer specialized training like business plan development and marketing for immigrants from Cuba, Haiti and Asia.<\/p>\n

The Wilson\/Fish Program managed by the U.S. Department of Health and Human Services also provides refugee and entrant help. This is a cooperative-agreement grant limited to immigrants from:<\/p>\n