E2 Visa Requirements: Source of Funds

Hi everyone! It’s Angie Rupert founder of Rupert Law Group. We handle exclusively E2 visas; so, no matter what treaty country you’re from or what state you want to be in, we can help.

Today we’re going to talk about one of the other E2 visa requirements, which is the source of funds. This is part of the investment requirement; and the source of funds basically answers two questions:

1. Where did this money come from?
2. What documents are you going to show us in order to prove that?

Let’s talk a little bit about this step. This is one of the first steps in the E2 visa process and it is the most tedious for most people. So, don’t get frustrated up front, finish your source of funds and the rest is a lot simpler, in most cases. Now, let’s talk about what the government wants to see when they’re talking about your source of funds. The requirements are that the money comes from legal means and that that money is in your possession and control, if you’re the investor. What does it mean “of legal means”? Honestly, it’s that broad and that big –  they just want to make sure that no matter where the money comes from that it was a legal source of funds.

Note: Do they care what country the money comes from? For the most part no. It doesn’t have to be in the U.S., out of the U.S., it doesn’t have to be from your treaty country, it could be somewhere else entirely. For the most part, that is fine.

So, let’s talk a little bit about the different types of sources that we see. Some people have one source of funds and if it’s a source of funds that’s an event, that’s amazing! A lot of times those are much easier to show as far as the documentation than having a variety of different sources and sources that build over time. So, what’s an event? Something like, “I just got divorced and here’s my divorce paperwork showing the amount of my settlement. That’s the money that I’m going to be using.” Or, “I just sold a house. Here’s the paperwork showing how much I got for the sale of my house,” or something similar, right? It’s one event, the money comes in from one event, that’s the money that transfers to the United States, and that’s the money invested in this business.

However, there are other sources of funds that are obviously completely legitimate but are a little bit more difficult or lengthy to document. So, let’s talk about some of those. One, would just be personal savings; and frankly, about 80% of our clients use personal savings. So, what’s that mean? Well, how long have you been saving the money? Have you saved $1,000 every month for the last 80 months? Have you saved $200 a month, and then nothing, and then $10,000, and then another $7,000, and then nothing, and then the next month nothing, and then the next month $400? That’s how most people save money, honestly.  In that case, depending on where you’re filing, we show how much money you’re going to invest and, of course, where it all came from. Sometimes we need to show your personal tax returns, sometimes we need to show your bank statements, and sometimes we need to show both. Sometimes we need to provide documents that show that you’re the owner of a company, those types of things. Those are the types of documents we need. And, what documents we need specifically and how many documents we need specifically are going to depend a lot on you, your case, and your money.

Hang with us through this portion because it is the most tedious portion of the E2 visa; but once it’s done and once it’s clear, the rest of the application seems to be a lot simpler.

We talked about that the source of funds doesn’t really matter what country it comes from for the most part, right? And it doesn’t matter how you got the money as long as it’s legal. We talked about a few things, an event, and personal savings.

How about a gift from a friend or a family member? Yes! Those can count. Many of our clients have received gifts for friends or family. If it’s a close family member, it’s usually very easy to document. However, if it’s a friend, sometimes there are a few questions like, “Who is this friend,” “What kind of friend gives another friend $50,000,” “Are there any strings attached this money?” Those types of things, so keep that in mind.

We also see (as mentioned) sale of a house, loans on personal assets like a house, getting a line of credit, getting a second mortgage on a house, something like that. We’ve seen those types of things, as well. Remember that loans based on the business do not count as part of the investment. Do not use a loan based on the business, ok? That will not count as part of the investment; so keep that in mind, as well. We’ve also seen personal loans or signature loans, we have seen family loans that were personal in nature and we’ve also seen, as mentioned, divorces, mortgages, sale of a house, personal savings, dividend payments or distribution payments from companies that the investor owns in other countries. These types of things. You could also use, although I’ve never seen it because it’s pretty rare; but, you could use lottery winnings as well. So, keep that in mind.

Next question, can I use a variety of sources? Of course. Absolutely. Some people have a family gift and personal savings and they got a second mortgage on their house or something similar. That’s ok as well, just keep in mind that we have to document each and every source and how the money moved from its original location to the U.S. company account.

The question is, of course, what kind of documents are we going to need? Again, it’s really going to depend so much on your case: not only your source of funds but the timeline of when you got the funds, how long you’ve been saving them, did you just receive them, those types of things. We really will need to know a lot more about the specific facts in your case in order to get into the different documents that we need to show that money.

Third of all and something that’s really important is, this money needs to be in your possession and control. What does that mean? Normally, we like to see that in your personal bank account whether in your home country, a third country or the United States at least for a moment, that way we can show that these funds are under your possession and control and can be used to invest in a new business in the United States.

Do you have any more questions about source of funds? I know you do. This is the most complicated part so, reach out anytime, happy to speak with you about the E2 visa requirement: source of funds.

Reach out anytime, happy to speak with you again. I’m Angie Rupert founder of Rupert Law Group and would love to speak with you about the E2 visa. Thanks.