What Is Marginality, Regarding an E-2 Immigration Visa? - Plan Friday

Posted in Articles by Brent Butler

The author’s views are entirely his or her own and do not represent legal advice or council.

Are you seeking an E-2 immigration visa? Then you’re in luck. In this week’s Plan Friday, Brent explains what marginality is and how to satisfy the U.S. government’s marginality requirement.

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Video Transcript

Marginality primarily matters for E-2 visa applicants. The E-2 visa enables foreign business owners from one of America's 80+ treaty countries to work in America for two years. The E-2 visa can then be renewed indefinitely.

First, what is marginality? A marginal business is one that only supports you and your family and doesn’t contribute much to the American economy. If you move to the U.S., work out of your garage, and sell customized dog sweaters on Craigslist, then let me know, because who doesn’t love a dog in a sweater?! Sorry, what I meant was, if you sell something out of your home and you don’t have any office space or employees, your business is probably marginal. Yes, you’re making money, but that money isn’t going back into the U.S. economy. You probably won’t meet USCIS’ marginality requirement.

You want to be better than marginal. And that’s pretty easy. You just have to make enough money within your first few years to support yourself (if you’re the E-2 visa applicant) and at least one other full-time employee who isn’t a relative. Even better if you are paying several employees as well as rent on office space. In other words, you can still sell doggy apparel--just do it at a slightly bigger scale.

Even though meeting the marginality requirement sounds pretty simple, most immigration visa applicants don’t realize how important it is. And you need a solid business plan to demonstrate that your business is not marginal.

Without a business plan that proves you exceed the requirements, your visa could be denied, or you could get an RFE, request for evidence. And in today’s political climate, getting an immigration visa is harder than ever. It’s tricky, because marginality is subjective, and in recent years, USCIS has gotten more strict about what it means. For example, a restaurant in Maine was forced to close after 9 years in business when USCIS said it had become “marginal” and rejected the owners’ E-2 visa renewal.

Protect yourself by making sure your business isn’t marginal, even if it’s been in operation for a long time. Ideally, your visa application or renewal will be approved, and you’ll be able to come to America or continue to stay here running your business. Here are five steps to showing USCIS that your business will not be marginal:

#1 Create a Business Plan

In order to meet the marginality requirement, you need to demonstrate that your business will create one or more full-time jobs in the first few years. The easiest way to do that is to create a business plan.

#2 Include the Details

Your business plan for immigration should include a description of your product or service, details about your target market and competitors, a brief summary of your qualifications, a marketing plan, and a five-year financial forecast, as well as any supporting documents like a lease agreement for office space.

#3 Forecast Sufficient Revenue

It should include a payroll summary with the title and salary of all employees you plan to hire, as well as in what month you’ll hire them.

#4 Show You’ll Hire Adequate Staff

You don’t have to hire a lot of employees or pay them huge salaries. Maybe you’ll just hire one full-time office manager and one full-time salesperson in addition to yourself as CEO. Theoretically, that’s enough to satisfy the marginality requirement!

#5 Show You Are Supporting the U.S. Economy

Your financial forecast is also where you will include costs you’ll pay for office supplies, equipment, land or office space, and other assets and expenses. These expenditures help support the economy of your local community, which is what USCIS wants to see. The government doesn’t want to grant someone a visa if they’re going to be a drain on the system. Instead, your business should support other businesses and create American jobs. That gives you your best shot at getting your visa application approved.

If you aren’t comfortable creating financial projections, work with an accountant or hire the business plan professionals at Masterplans.

Thankfully, a solid business plan can address marginality head-on and prevent an RFE or denial. One client of ours seeking an E-2 visa had founded an architecture firm, but they weren’t planning on having full-time employees--just some freelance draft technicians. That would NOT have flown with USCIS. So we used the hours per project per draft technician to compute how many full-time hires that would equate to, which we showed in the payroll forecast, and voila! Success.

Disclaimer: The information in this blog post is intended to be general information; it is not legal or financial advice. Specific legal or financial advice can only be given by a licensed professional with full knowledge of all the facts and circumstances of your situation. Consult with legal and financial experts before making financial investments.

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Brent Butler is Masterplans’ founder and CEO.

Tagged: PlanFriday, video, immigration
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