Understanding Carry-Over Visas and Their Impact on EB-5 Investors

Every fiscal year (October 1 – September 30), approximately 140,000 employment-based Green Cards are made available to qualified applicants under the provisions of U.S. immigration law. Any unused family-based Green Cards from the previous year are also added to the quota, supplementing the annual availability of employment-based visas.

The total supply of employment-based visas is further distributed across five categories (EB-1 to EB-5), of which the employment-based fifth preference visa category, popularly known as the EB-5 visa, is allocated a 7.1% share.

In FY 2024, the Department of State established the employment-based visa limit at 161,000, giving the EB-5 category an allowance of 11,431 visas.

Besides the 7.1% yearly quota, an additional 10,874 EB-5 visas are also available in FY 2024 that have been carried forward from the previous two years. This extra supply of visas has almost doubled the visa availability in FY 2024.

In this article, we will discuss how these carry-over EB-5 visas have come about and what they mean for EB-5 investors.

EB-5 Reserved Visa Allocation

EB-5 set-aside visas were created by the EB-5 Reform and Integrity Act of 2022 (RIA) to promote investments in underserved targeted employment areas (TEAs). The provision was favorable for investors as well, as it could potentially speed up their Green Card process.

The RIA introduced a 32% reserved visa quota for three set-aside categories: rural TEA projects (20%), high-unemployment TEA projects (10%), and designated infrastructure projects (2%).

As a new subdivision within the EB-5 quota, the reserved category created a pool of EB-5 visas for applicants who choose to invest in approved projects in one of the set-aside categories. The initiative was especially beneficial for applicants from traditionally backlogged countries, such as India and China, who could now bypass the long queue for unreserved visas and receive their Green Cards without any extended waiting time.

The RIA also mandated that any reserved visa numbers left unused in a fiscal year will be carried forward to the successive year’s reserved EB-5 visa quota.

In case any carry-over reserved visas are left unused in the successive year, they will once again carry over to the next fiscal year, but this time as unreserved visas.

However, the unreserved visas cannot be carried forward and will be lost if not used in the ongoing fiscal year.

We will now see how this provision of the RIA has added more than 10,000 visas to FY 2024 as carry-overs from the previous two years.

FY 2022

Following the enactment of the RIA in March 2022, 6,396 visas (32% of the total supply in FY 2022) were reserved as visa set-asides for allocation to applicants who qualified for the reserved categories.

However, none of the reserved visas could be issued in FY 2022. As per the new law, these visa numbers were carried over to the next fiscal year and added to the reserved category quota in FY 2023.

FY 2023

FY 2023 received a fresh reserved category quota of 4,478 visas (32% of the total supply in FY 2023). Combined with the 6,396 carried-over reserved visas from FY 2022, the total reserved visas available in FY 2023 was 10,874. Again, none of the reserved visas could be issued in FY 2023 and, as per law, the unused reserved visas from both years were carried forward to FY 2024.

However, according to the RIA rules, only the reserved visas carried over from FY 2023 (4,478) could be added to the reserved visa supply for FY 2024. The reserved visa numbers carried over from FY 2022 (6,396) were now made available to the unreserved category.

FY 2024

The annual EB-5 quota allocated to FY 2024 was 11,431 visas, of which 3,658 were reserved visa set-asides (32% of 11,431). By adding these to the 4,478 reserved visas carried forward from FY 2023, the total reserved visa availability in FY 2024 went up to 8,136.

Similarly, the 6,396 visas carried forward from FY 2022 were added to the 7,773 (68% of 11,431) unreserved visas allocated in FY 2024, taking the total unreserved visa supply for FY 2024 to 14,169.

To sum up, FY 2024 has a supply of 8,136 reserved visas and 14,169 unreserved visas. Due to the reserved visa carry-over provision of the RIA, the total EB-5 visa availability in FY 2024 has nearly doubled from 11,431 to 22,305.

The table below shows visa availability in FY 2024 at a glance, including the carry-over visa supply from FY 2022 and FY 2023.

 
Notably, as there is no provision in the RIA for carrying forward unreserved visas, the 6,396 unused set-aside visas from FY 2022 (now part of the unreserved pool) will be lost forever if they are not used in FY 2024. To avoid visa wastage, the Department of State has clarified that carry-over visas will be used up first, and the regular visa quota will be utilized only after the carry-over visas have been exhausted.

Impact of Carry-Over Visas on EB-5 Investors

The carry-over EB-5 visas have increased the visa availability for both pre-RIA and post-RIA investors. Although pre-RIA investors cannot access reserved visa set-asides, the addition of unused reserved visas from FY 2022 to the unreserved visa supply of FY 2024 could somewhat alleviate the visa backlog for pre-RIA investors from India and China.

For post-RIA investors, FY 2024 has an above-average visa supply in both reserved and unreserved categories. While the backlog in the unreserved category is expected to come down, the reserved category may also hold off retrogression for some time due to the abundant supply of set-aside visas.

That said, high-unemployment TEA projects have a high demand from investors, but this category has been allocated only 10% of the reserved visas. According to some estimates, high-unemployment urban TEA petitions may be the first among the reserved set-aside categories to face backlogs as the demand may soon outnumber the reserved visa supply in this category.

On the other hand, with the highest share of reserved visas and priority processing for rural EB-5 petitions, rural investments could be the best option for potential EB-5 investors looking for fast-track immigration.

Investors from high-demand countries must assess their options carefully before selecting between a rural and a high-unemployment TEA project.

Simplify Your EB-5 Journey With EB5AN

The introduction of the set-aside reserved visa category has brought in a lot of hope for EB-5 applicants from China and India, who can now expect some relief in the long waiting times for their EB-5 Green Cards. As the demand for the EB-5 Green Card continues to rise, investors must take advantage of the surplus visa availability in FY 2024.

To ensure that you make the right investment and complete your immigration journey in the shortest possible time, EB5AN can guide you every step of the way.

EB5AN has helped more than 2,300 families from 60 countries relocate to the United States as lawful permanent residents. Our expert team has more than a decade of experience and offers clients first-rate, low-risk EB-5 regional center projects with a 100% USCIS project approval rate.

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