Frequently Asked Questions
Q: What is a limited partnership?
A limited partnership is business organization with one or more general partners, who manage the business and assume legal debts and obligations, and one or more limited partners, who are liable only to the extent of their investments. Limited partners also enjoy rights to the partnership's cash flow, but are not liable for company obligations.
A limited partnership combines corporate limited liability with partnership taxation. The limited partnership, formed by filing a charter with a state government, consists of a general partner and one or more limited partners. The charter details the rights and powers of the limited and general partners, percentages of ownership, and distributions of profits. The general partner manages the business. The limited partners are investors liable only for the value of their investment. Limited partnership income is taxed at the partner level, not at the entity level.
USA Global Development uses a limited partnership because the USCIS regulations specifically refer to limited partners, exempting them from the requirement to actively participate in the business on a day to day basis
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Q: How is my limited partnership interest protected?
The Certificate of Limited Partnership is recorded with the State of California as a public record. The Certificate refers to a Schedule A of the limited partnership agreement, which lists the names and percentage interests of the limited partners. The deed for the investment property is held in the name of the limited partnership. The deed is also of public record. This means the property may not be sold, mortgaged or altered without complying with the terms of the limited partnership agreement.
Q: How is your investment structured?
Each Limited Partnership owns a percentage of the Limited Partnership which in turn owns the full project including the real estate and the business. Your investment purchases an interest in the Limited Partnership. You become a Limited Partner. Your percentage share of the Limited Partnership depends on the percentage your investment bares to the value of the project. The prospectus for the project describes the valuation methodology.
The Limited Partnership, managed by USA GlobalDevelopment and Phillips Development Company are the general partners of the Limited Partnership. The general partner purchases the raw land, plans and entitles the development, sells or leases the specific portions and manages the property. The Limited Partners receive their share of the income from the properties. The terms of the Limited Partnership agreement include a prevision that all investors receive a preferential distribution and participation in available cash from net income.
Q: What is an EB-5 Visa?
An EB-5 visa under the US immigration laws is known as the Employment Creation visa. It is also known as the permanent investor visa. The visa is a Permanent Resident visa (“Green Card”) which permits employment in the US for the investor and his/her immediate family (spouse and unmarried children under 21). EB-5 investors may work in a full time or part time capacity or own and operate additional unrelated businesses. Investors are not required to actively manage the business of the enterprise in which they have invested.
Q: Who should invest?
EB-5 qualified Investors include people from all walks of life; professionals, business people, persons wanting to facilitate a child's education, and retirees.
If your goal is to have a Green Card and not to actively manage a business, it is most often the best way to utilize the EB-5 category rather than to start and maintain a business.
Q: Is my investment guaranteed?
No. The law requires an "at risk" investment without guarantees or redemption rights.
Q: What are my risks?
As in any investment there is a risk of total loss. We invest in real estate with a mortgage or bank financing. Like everybody we risk the deleterious effects of acts of god, war, and market fluctuations in rental income or real estate prices. We urge all investors to visit us, check our references and to independently verify the information contained in our prospectus.
Q: Is EB-5 a truly passive investment?
The EB-5 regulations require involvement in management or policy making. The regulations provide for a limited partner in a limited partnership that conforms to the Uniform Limited Partnership Act to be sufficiently engaged in the management of the EB-5 enterprise.
Q: How does the partnership distribute income?
The partnership distributes profits to its investors based on available cash quarterly in arrears. The distributions are based after prior quarter’s net income and available cash. Investors receive a profit and loss statement with each quarter’s distribution. At the end of the year the partnership issues a summary report along with Internal Revenue Service form K-1. Form K-1 details your yearly income and expenses. Your accountant will require form K-1 to prepare your US annual tax return.
Q: Why must I invest before you will apply for my Green Card?
Our primary business is real estate development. A sizable portion of our capital comes from investors who do not seek an immigration benefit. These investors invest on financial consideration only, without preconditions. EB-5 investors, however, have two considerations, the soundness of the investment, and obtaining their Green Cards.
The investment must be analyzed upon its merits. Our policy is to require that you commit your capital as any other investor. If for some reason, you do not receive your Green Card; our contract with you requires us to refund your investment. ( See details in subscription agreement)
Q: What documents must I prepare to process my visa petition?
Each applicant and his/her qualified dependants must prepare complete biographical information. The principal applicant must prove the lawful source of the investment funds. To prove the source of investment funds, USCIS requires five years of tax returns, five years of bank records, proof of ownership in any businesses, financial statements for each business and business licenses. The idea is present a track record of an honest course of dealing. If your capital came from a specific transaction, such as sale of a house, inheritance or gift, you must prove the transaction occurred, by providing an official document, such as a closing statement or contract or other official documents. This is not an exhaustive list. Other documents may be required and vary on a case-by-case basis.
Q: How long does the Immigration Department take to process my visa petition?
Processing times vary from as little as a few weeks to sometimes more than six months. We can't predict or promise a particular processing time. You should plan for the entire process to take approximately one year.
Q: What are the processing procedures?
A general outline of the application process follows. The attorney processing the case will be able to give you a more complete description.
Step 1) File form I-526 Petition for Alien Entrepreneur with the California Service Center. This petition requests INS to certify the applicant and the investment as eligible for EB-5 visa status.
Step 2) Upon approval of the I-526 petition, (a) if you are in the United States you may apply for Adjustment of Status to Permanent Residence by sending form I-485 and supporting documents to the USCIS regional processing center having jurisdiction over your US residence; (b) if you are not in the US you must wait for a notification from the US Department of State and the US Embassy/Consulate in your home country to prepare documents and for the appointment date for the visa interview. The attorney who filed the form I-526 may also receive the notices.
The purpose of the Adjustment of Status or consular visa interview is to make sure you are not subject to grounds of exclusion, e.g. a criminal past, prior failure to comply with US immigration law including overstaying the valid time of a permitted entry into the US, infectious diseases, etc. After approval of the adjustment of status the Conditional Green Card will be mailed to the investor and his/her qualified family.
Step 3) In the case of consular processing outside of the US and upon approval you will receive a form evidencing the approval and as well as a travel document. Upon arrival in the US you will again be inspected to check that you have the correct documents with you and in fact meet the legal requirements for admission to the US as a permanent resident. After admission you will also receive the Conditional Green Card in the mail. You must enter the US within six months of the date of the approval from the interview by the US consul.
Step 4) 90 days before the second anniversary of the date of your approval or admission as a conditional resident and not later than 2 years thereafter you MUST file a substantive application with the USCIS for removal of the conditions to obtain your permanent Green Card using Form I-829. This procedure permits USCIS to verify that you have maintained your approved investment, and that the Limited Partnership has complied with the Employment Creation requirements of the law.
Q: Where can I find a copy of the relevant law and regulations to study?
Please go to the Bureau of Citizenship and Immigrations Services web site.
A direct link to investment visa information is: U.S Citizenship and Immigration Services
Q: How do I apply?
For further information please contact:
grace@usagdc.com
100 Pacifica, Suite 345
Irvine, California 92618
USA Global Development Company