accredited investor
Where the investors are investing through the EB-5 RC program, the investor is subject to an additional requirement, before he/she is found to be eligible to invest. An investor must be an “accredited” investor pursuant to the Securities & Exchange Commission regulations. An investor is deemed to be an “accredited” investor where:
· a natural person who has individual net worth, or joint net worth with the person’s spouse, that exceeds $1 million at the time of the purchase, excluding the value of the primary residence of such person;
· a natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year; or
· a trust with assets in excess of $5 million, not formed to acquire the securities offered, whose purchases a sophisticated person makes.
One must understand the “accreditation requirement is not an EB-5 requirement but in fact a Securities Law requisite. Most EB-5 RC programs seek “accredited investors” to avoid complications and issues that may arise by selling to non-accredited investors.
· a natural person who has individual net worth, or joint net worth with the person’s spouse, that exceeds $1 million at the time of the purchase, excluding the value of the primary residence of such person;
· a natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year; or
· a trust with assets in excess of $5 million, not formed to acquire the securities offered, whose purchases a sophisticated person makes.
One must understand the “accreditation requirement is not an EB-5 requirement but in fact a Securities Law requisite. Most EB-5 RC programs seek “accredited investors” to avoid complications and issues that may arise by selling to non-accredited investors.