Increased USCIS Scrutiny on the EB-5 Source of Funds: 5 Tips for a Strong Petition

Published: April 1, 2025

The United States Citizenship and Immigration Services (USCIS) provides different avenues for foreign nationals to secure legal status in the US. Under the EB-5 Immigrant Investor Program, foreign investors and their spouses can apply for lawful permanent residence. 

In FY2022, 10,885 admissions were recorded under the EB-5 category. Each EB-5 application is subject to the US government’s comprehensive screening. Demonstrating the lawful source of investment funds is critical to an EB-5 petition.

However, a lack of understanding of the EB-5 source of investment fund requirements often causes delays or denials. As USCIS examines the origin of EB-5 investment funds more closely, issues with the legality of the funds invested have become increasingly common. 

In this post, we’ll discuss the increased USCIS scrutiny on the EB-5 source of funds and how to strengthen your petition under the current review standards for better chances of approval. 

1. Understand the EB-5 Source of Fund Requirements

Proving the legality of EB-5 investment capital is paramount to a successful EB-5 petition. Every transaction leading to the final investment must be documented and traceable. Failure to document and trace transactions leading to the final EB-5 investment can result in Requests for Evidence (RFEs) or denials.

Your funds must not come from illegal activities like tax evasion, money laundering, or corruption. USCIS will reject EB-5 applications containing illegally sourced investment funds. The following are common lawful sources of EB-5 investment funds:

• Personal savings
• Employment earnings
• Real estate sales
• Business income
• Stock or securities sales
• Gifts
• Inheritance
• Loans

 

2. Prepare With Detailed and Verifiable Documentation

USCIS requires foreign investors to present diverse documentation demonstrating the legal source of investment funds. 

Because of that, preparing with detailed and verifiable documentation is imperative to prevent unnecessary delays. Below are some types of records you must gather to meet the USCIS standards for the EB-5 program and verify your funds are lawfully required. 

• Business registration records
• Income tax returns
• Gift and inheritance documents
• Bank transfer records
• Real estate ownership and sales contracts
• Certified copies of court judgements
• Government administrative proceedings within the past 15 years

3. Document Gifted and Loaned EB-5 Funds

Gifts and loans can be alternative sources of EB-5 investment funds. However, you must meet certain conditions to satisfy USCIS source-of-fund requirements. The required evidence to properly trace and source funds differs from source to source. 

Still, whether from business, income, or real estate proceeds, USCIS utilizes a preponderance of the evidence standard. It places the burden of proof on you in presenting comprehensive documentation and information to support your EB-5 petition. 

4. Demonstrate Compliance with Tax Requirements

Upon entering the US, the EB-5 investor is subject to US income tax compliance annually. Fulfilling your tax obligations accurately and promptly in the US and other jurisdictions where you filed taxes. 

Tax compliance is a critical aspect of establishing the legitimacy of investment funds. You must ensure you have filed and paid all applicable taxes on the income used for your EB-5 investment. Submitting five years of tax returns is typically recommended, but the specific requirement can differ based on individual circumstances. 

Numerous legitimate reasons could prevent you from providing five years of tax returns. When you cannot provide tax returns, a detailed explanation and a letter from a tax professional are likely necessary. 

5. Ensure a Transparent and Detailed Paper Trail

USCIS examines every financial transaction related to an EB-5 investment to prove the funds are acquired through lawful means. Any gaps or discrepancies can lead to further scrutiny and potentially result in a denial. 

Thus, you must ensure a transparent and detailed paper trail illustrating how you obtain and move your investment funds. You will have a stronger EB-5 petition by providing thorough and well-organized documents. 

Achieve Your EB-5 Investment Goals With ALG Lawyers

USCIS’s primary concern is the lawful origin of the investment funds. This requirement aims to ensure the EB-5 program’s integrity and to prevent illegal and/or criminal activities. Suppose you consider securing a green card through the EB-5 visa program. You must prepare documentation carefully explaining your funding sources and their paths. 

There’s no standard list of source-of-funds documents since each investor’s case is unique. Instead, the required documentation and the appropriate tracing of your funds will depend on your circumstances. An experienced Los Angeles immigration lawyer is beneficial in strategizing your EB-5 investment. Call ALG Lawyers for personalized assistance.