Pre-immigration tax planning for EB-5 investors means restructuring foreign assets and entities during the window before the United States begins taxing you on worldwide income. That window closes on a specific date. For most EB-5 families it is the day of admission to the United States as a lawful permanent resident, or the day Form I-485 is approved for those adjusting status from inside the country. Work done after that date is damage control, and it usually costs several times what the same work costs six months earlier.
One rule drives everything else. US tax residents are taxed on income from every country, at graduated rates, with credits for foreign tax paid but no relief for the fact that the money never touched an American bank. Someone arriving from a jurisdiction with no capital gains tax finds this genuinely shocking. Plan for it before you land.
The exact moment you become a US tax resident
Two separate tests can make you a resident, and EB-5 families trip the second one without noticing. The green card test starts residency on the first day you are physically present in the United States as a lawful permanent resident. The IRS substantial presence test counts days instead: 31 days in the current year, and 183 days on a formula that adds every day this year to one third of last year's days and one sixth of the days from the year before that.
That formula catches people. An investor who spends 122 days a year in the United States on a visitor visa while the I-526E is pending is already a US tax resident, green card or not, since repeating that pattern for three years pushes the weighted count to exactly 183. The IRS page on determining an individual's tax residency status sets out the exempt categories and the closer connection exception.
There is no automatic step-up in basis
Several countries deem a new resident to acquire all their assets at market value on the day of arrival. The United States does not. If you bought shares in 2009 for the equivalent of $200,000 and they are worth $1.4 million on the day you land, the entire $1.2 million gain stays exposed to US tax when you eventually sell, even though every cent of it accrued while you lived somewhere else.
So the standard maneuver is to create the step-up yourself. Sell the appreciated asset before residency begins and, where it makes commercial sense, buy it back. The gain falls under your home country's rules, or escapes tax entirely if that country exempts it, and your US basis resets to the repurchase price. Check the home country holding period rules first. Some jurisdictions tax a sale made within a set number of years of purchase.
Structures that turn toxic on arrival
Foreign mutual funds. Almost any pooled non-US fund is a Passive Foreign Investment Company. The default PFIC regime under section 1291 taxes excess distributions and gains at the highest ordinary rate in force for each year the income is allocated to, then adds an interest charge for the deferral. Fifteen years of quiet compounding can be worth far less after a US sale than a naive calculation suggests. Selling before residency avoids the whole apparatus.
Controlled foreign corporations. A family holding company becomes a CFC once US shareholders own more than 50 percent, which pulls in Subpart F income and the GILTI inclusion, plus an annual Form 5471 whose late filing penalty starts at $10,000 per form per year. Distributing accumulated earnings before residency begins is standard practice, and so is a properly timed entity classification election.
Foreign trusts. Section 679 reaches back five years, so a trust funded by someone who becomes a US resident within five years of the transfer can be treated as a grantor trust with the income taxed to the grantor. Reporting runs on Forms 3520 and 3520-A. Penalties there are severe enough that some families unwind the structure rather than carry the compliance load.
What the $800,000 itself does to your return
Very little, at first. The investment is a capital contribution to a new commercial enterprise, so it is not deductible, and moving it across the border creates no taxable income. Distributions from the partnership arrive on a Schedule K-1 and become taxable once you are a resident. When the capital is eventually returned, the portion equal to your basis is not income at all, though any excess is.
Wiring the money is its own project, and getting it wrong creates a source of funds problem alongside the tax one. EB-5 Currency Transfers and US Banking: Moving $800,000 Legally covers those mechanics. Note also that 8 CFR 204.6 requires tax returns of any kind filed within the five years before the petition, so an aggressive restructuring will be visible to USCIS as well as to the IRS.
Reporting you cannot skip
FBAR first. Any US person whose foreign financial accounts exceed $10,000 in aggregate at any moment in the calendar year files FinCEN Form 114, the Report of Foreign Bank and Financial Accounts. Aggregate means every account added together, so four accounts holding $3,000 each will trigger it. Signature authority over a company account counts even when none of the money is yours.
Form 8938 is the FATCA report on specified foreign financial assets, filed with the income tax return, starting at $50,000 for a single filer living in the United States and rising for joint filers and for residents abroad. Both filings can apply to the same account. Both have to be made.
The exit tax nobody mentions at the seminar
Green cards get surrendered. Businesses fail, parents get ill, plans change.
A permanent resident who holds the card in at least eight of the previous fifteen tax years becomes a long-term resident, and abandoning that status can trigger the section 877A mark to market exit tax once net worth reaches $2 million or the average income tax liability test is met. Think about that around year six. Some families conclude that naturalizing is the cleaner outcome, and the timing for that is laid out in EB-5 Citizen Pathway: Naturalization, Form N-400 and the 5 Year Rule.
One trap deserves a flag. A green card holder who files as a treaty nonresident to escape worldwide taxation may be treated as having abandoned permanent residence, and USCIS guidance on maintaining permanent residence is why immigration counsel and tax counsel have to speak to each other before that election is made.
Estate and gift exposure changes overnight
A nonresident who is not US domiciled gets an exemption of only $60,000 against US situs assets for estate tax purposes. Become domiciled, which a green card holder generally does on arrival, and worldwide assets fall inside the US estate tax net at the far larger resident exemption. Gifts of non-US situs property made before residency begins sit outside the US gift tax system altogether. That is a one time opportunity with a hard deadline, and U.S. Estate Tax Implications for Wealthy EB-5 Investors works through it in detail.
A workable sequence
Start twelve months out if you can. Retain a US international tax advisor before the I-526E is filed, since several of the moves above need a full tax year to execute cleanly.
Then work through the inventory in order. Appreciated securities and real property first, because those carry the step-up question. Pooled funds next, since PFIC exposure compounds every year it goes unaddressed. Corporate and trust structures after that, as they take longest to unwind. Foreign pensions and life insurance last, because treaty treatment varies wildly by country and some policies fail the US definition of insurance outright.
Families who plan to stop working after arrival face a different calculus again, covered in EB-5 for Retirement in the US: Florida, Healthcare, Taxes, Cost.
A final warning. Immigration counsel does not do tax, and the tax advisor does not do immigration. Neither will spot a problem sitting in the other's field, and for a wealthy family the $800,000 is often the smallest number in the conversation.