H1B Visa Holder Doing Real Estate Investment

H1B Visa Holder Doing Real Estate Investment

Investor · Little Rock, AR · Member since 2016 · 121 posts · 37 votes

I'm currently a H1B visa (Temporary Worker) holder working full time in the states, trying to start my real estate investment. My current employer is sponsoring my green card application, but the whole process will take another 4 years to complete. According to immigration law, I'm not authorized to work for unsponsored employer currently, which includes myself in this case if I start my business on the side. Also to my knowledge, all my income outside of sponsored job has to be passive income. I can also form a LLC but can't operate or engage in any business activity. I'm wondering anyone had same experience before, and know how to get around this limitation and do real estate investment. My goal is to do rentals since that's passive income nature. But I'm pretty sure as I do more deals, there will be wholesale and flipping come up every now and then. Eventually when I am at final stage of green card application (I-485 Adjustment of Status), the USCIS will look at my past 3 years tax return. So I don't want to raise suspicion, which could lead them to deny my application. Help me out here fellow BG investors. Thank you!

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Developer · Philadelphia, PA · Member since 2015 · 2k+ posts · 905 votes
10y
Andrew Y. - not a lawyer but I know someone in a similar position who acted as a private money lender (silent partner) on a rehab to generate passive income. You could also look into the many turnkey providers to sites like Realtyshares, Honemestors, etc who will provide you with a K1 for passive income.
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  • Investor · San Francisco, CA · Member since 2016 · 314 posts · 153 votes
    10y

    @Andrew Yu How much risk of losing the green card and being deported do you want to take? If 'none' is your answer, talk to your company's immigration lawyer.

  • Investor · Winnipeg, Manitoba · Member since 2013 · 303 posts · 321 votes
    10y

    @Andrew Yu

    You are posting a sensititive question to your application on internet.

    anyone can read & do research on you, including immigration department.

  • Investor · Little Rock, AR · Member since 2016 · 121 posts · 37 votes
    10y

    I don't think my company's lawyer would help much. I just want to find a completely legal way to invest in real estate. But it just seems there are very few lawyers out there that understand this. 

  • Developer · Philadelphia, PA · Member since 2015 · 2k+ posts · 905 votes
    10y
    Andrew Y. - not a lawyer but I know someone in a similar position who acted as a private money lender (silent partner) on a rehab to generate passive income. You could also look into the many turnkey providers to sites like Realtyshares, Honemestors, etc who will provide you with a K1 for passive income.
  • Investor · Little Rock, AR · Member since 2016 · 121 posts · 37 votes
    10y

    @Percy N. Awesome advice!

  • Investor · Cleveland, OH · Member since 2015 · 6k+ posts · 2k+ votes
    10y

    @Andrew Yu, people often invest in US property while living and having citizenship OVERSEAS!

    I don't see your situation as any different. Just make sure that when you invest, you have a LOCAL team who you have dealt with and trust (Contractor/s and Property Manager at the very least).

    [Not legal advice]. All the best...

  • Investor · Little Rock, AR · Member since 2016 · 121 posts · 37 votes
    10y

    @Brent Coombs I'm thinking the same thing. Since foreign nationals can invest freely in US real estate market, I shouldn't have problems. 

  • Tampa, FL · Member since 2016 · 27 posts · 4 votes
    9y

    Hi Andrew - I'm on the same boat. I'm curious what you found out. Did you get advice from your immigration lawyer? 

  • Investor · Colorado Springs, CO · Member since 2016 · 72 posts · 10 votes
    9y

    The question isn't about investing in real estate. 

    The question is about wholesaling and flipping etc. 

    That's considered earned income rather than passive income. 

    He can invest and get rentals. He can't buy, rehab and sell for profit consistently.  That's considered running a business. 

    He can do 1 or 2 and argue he got it as an investor and changes his mind or something like that but not if he does it consistently.  

  • Tampa, FL · Member since 2016 · 27 posts · 4 votes
    9y

    Did you form a LLC for buy-hold strategy? I was confused about how to file taxes and separate tax deductibles from personal and business filing, as a H1B holder. Can you have tax write offs even when the business is not generating income yet?

  • Engineer · Portland, OR · Member since 2014 · 1k+ posts · 1k+ votes
    9y
    It's beyond unlikely the bureaucrats who mishandle our boondoggle of naturalization are proactively concerned with internet postings concerning incorporation details for non-green card holders. They can't even process habitual illegal offenders and expired F1 and TN visa holders. Stop scaring the poor guy with nonsense.
  • Engineer · Portland, OR · Member since 2014 · 1k+ posts · 1k+ votes
    9y
    I agree that your company immigration lawyer is unlikely to know much. Your best bet is likely a CPA who deals with international clients and incorporation.
  • Investor · Little Rock, AR · Member since 2016 · 121 posts · 37 votes
    9y

    My advice is try to stay on the passive income side (rentals, notes, lending) instead of active side (flipping and wholesaling). If you can find a willing partner to form a company where he/she is the active member and you as complete passive investor, that would work as well. As far as tax goes, ask your CPA. They know how to handle it. It's pretty standard for them. 

  • Real Estate Investor · Jersey City, NJ · Member since 2016 · 3 posts · 1 vote
    9y

    If there is no partnership in LLC, then income from rentals is simply added along with 1040 return. No need to file separate taxes for LLC. Also, agree the above point that flipping and wholesaling consistently will be considered "being actively involved" and is against H1B rules. You could perfectly have a passive rental income or have an active partner manage the show while you take a back seat.

  • Investor · Newark NJ · Member since 2012 · 104 posts · 61 votes
    9y

    The prohibition against engaging in other forms of employment ( including being self employed in any capacity) stems from the fact that an H1B visa is issued at the urging of your employer. your employer essentially files a petition asking the government to allow them to employ you. USICS together with the department of labor (DOL) require your employer to provide evidence that you possess a certain set of skill and that the employer has tried but cannot find a suitable local candidate.

    The H1B visa allows you to work (earned income) for your employer only. Engaging in any other activities that generate earned income is a violation of the terms of the visa. Will you get into trouble if you do it? Probably not? Is it worth jeopardizing your chances of a GC? i guess that depends on the size of the deal.

    As far as flipping goes,  how is flipping any different from buying a stock and selling it for profit? in both cases the profits (if any) are treated as capital gains. 

  • Investor · Little Rock, AR · Member since 2016 · 121 posts · 37 votes
    9y

    Another option you can invest is through self-directed Roth IRA. You won't pay tax anyway through that. Just another strategy I found out.

  • Hagerstown, MD · Member since 2017 · 1 post · 0 votes
    9y

    I'm in the same boat, I'm on H1B  trying to buy some rental properties, @andrew did you find answer to your question? 

  • Investor · NY · Member since 2017 · 59 posts · 21 votes
    9y

    Does anyone have an update on this thread? I'm talking to an immigration lawyer through an online service to see what they say, but would like other inputs as well if other people talked to an lawyer.

  • Investor · Princeton, TX · Member since 2014 · 1k+ posts · 1k+ votes
    9y

    @Andrew Yu It appears you can invest in an LLC. Read this post.

    https://www.avvo.com/legal-answers/on-h1b-and-inve...

    Three immigration attorneys all agreed on that.

    Here is some more information

    https://www.avvo.com/legal-answers/can-i-be-a-pass...

    I think it comes down to the fact that you cannot make operational decisions.

    All that being said ask an attorney.  Also, if you happen to have hundreds of thousands of dollars in cash then there might be some other options.  If that is the case check into an E2 visa.

  • Boston Area, MA · Member since 2017 · 34 posts · 30 votes
    8y

    Hi @Andrew Yu My husband and I are here on H1B/H4 visas too. We would like to obtain rental properties to generate passive income and hold via LLC (to reduce legal liability). Is this what you ended up doing? I'd love to chat more about what you've done!

  • Nashville, TN · Member since 2016 · 6 posts · 1 vote
    8y
    Hi Andrew, I am interested to know what you find out about holding H1B status and investing in real estate ? I am on the same boat. Thank you!
  • South Jordan, UT · Member since 2018 · 3 posts · 0 votes
    8y
    Originally posted by @Andrew Yu:

    Another option you can invest is through self-directed Roth IRA. You won't pay tax anyway through that. Just another strategy I found out.

     Hi Andrew, Would you please enlighten us on our findings? It will be a great help!

    Thanks

  • Chris MasonPro Member
    Moderator
    Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
    8y

    This thread is weird. Generally speaking the big mortgage agencies -- Fannie, etc -- will not knowingly let you do something illegal at the federal level. And they have lots of lawyers that know about this stuff. But you can get a vanilla FNMA mortgage for a rental property with a valid H1B (provided there are no lender-specific overlays, which on this subject there usually are). Which implies to me that this big federal level entity -- for whatever it's worth -- seems to think that buying, maintaining, and owning a rental property is A-OK.

    But, then again, sometimes the right hand does not know what the left hand is doing. I'm not an immigration lawyer or qualified to give legal advice. 

  • Investor · Little Rock, AR · Member since 2016 · 121 posts · 37 votes
    8y

    @Gurpreet Saini Just search keyword self-directed IRA on BiggerPockets, you should find many posts about what it is and how to set it up.


    Again if you want to do real estate investment outside of your IRA, stay as passive as you can. Set up a manager-managed LLC with you being the member, you should be fine with lots of wholesaling & flips. Or set up a member-managed LLC, that you only do buy & hold properties with. Or in fact, if you only do buy & hold, you don't even need a LLC. Do consider asset protection in this case though. But ask an immigration attorney with some real estate knowledge should be your best bet.

  • Rental Property Investor · Florida & Shanghai · Member since 2017 · 192 posts · 68 votes
    8y

    @Andrew Yu  sounds like the safest way to invest would be to find an American partners and be a silent investor, at least until you get your green card.

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