Working in the U.S. on an ESTA or B Visa and Related Tax Risks

 FAQs:  ESTA or B Visa 

What activities are allowed under a Visa Waiver Program (VWP – i.e. ESTA) or B visa (B-1/B-2)? 

• B-1 Visa (Business Visitor): Allows non-resident aliens to enter the U.S. for business-related activities, such as attending meetings or conferences, but prohibits engaging in work that generates U.S. source income (such as direct employment or active participation in business operations). It’s important to note that “business meetings” refer to passive attendance and networking. They do not include affirmative actions in furtherance of the business or business activities, such as direct involvement in projects, making sales, or training people. 
• B-2 Visa (Tourist Visa): This is for tourism and personal purposes and does not allow any business or employment activities. 
• ESTA: Grants permission for short-term visits for business or tourism but does not allow work that generates U.S. source income. Like the B-1 visa, “business meetings” under ESTA refer to passive attendance only, and do not include active business operations or contributions. 

What is considered prohibited work on an ESTA or B-1 Visa? 

Activities that are strictly prohibited include: 

• Any paid or gainful employment in the U.S., regardless of whether the employer is foreign or U.S.-based. 
• Performing services that benefit a U.S. company in ways that a U.S. worker would otherwise perform, even if you are not compensated by the U.S. company. 
• Any work that is considered part of the U.S. labor market, such as project management, training U.S. workers, or other affirmative business operations. 

Work, professional labor, or skilled/unskilled labor (even if unpaid) is not permitted under the VWP. Travelers visiting the U.S. for work must obtain an appropriate work visa. 

What are some permissible activities under an ESTA or B-1 Visa? 

Permissible activities include: 

• Attending business meetings and conferences (passively) 
• Conducting business-related research activities 
• Negotiating a contract 
• Consulting with business associates 
• Traveling for a scientific, educational, professional or business convention or conference 
• Attending or participating in a trade show or conference 
• Installing or servicing equipment only in very specific instances where there is a foreign sale and the foreign company sends a technician to fulfill contractual obligations. This contractual obligation must be outlined ahead of time in the terms and conditions of the sale. 
• Certain types of work performed on the U.S. Outer Continental Shelf (OCS).
  • In this case, the foreign national’s B-1 Visa stamp must have the correct annotations & permissions prior to any work being performed on the OCS. This means a normal B-1 visa, lacking the required annotations, will not comply with U.S. immigration laws. 

Can I engage in business meetings while on an ESTA or B-1 Visa? 

Yes, you can attend business meetings, conferences, or conventions. However, these meetings must involve passive participation, such as networking, negotiating, or consulting. You cannot perform any tasks that actively contribute to business operations or generate income. Affirmative actions in furtherance of business are not allowed. 

Can I perform work in the U.S. for a foreign company under the ESTA or B Visa? 

No, performing any work, even for a foreign company, without a proper work visa is not allowed under the ESTA or B Visa. This is true even if the work is unpaid or the traveler is compensated by a foreign entity. 

Can foreign workers use a B-1 visa for work on the Outer Continental Shelf (OCS)? 

Yes, foreign workers can use a B-1 visa with an OCS annotation to perform specific duties on the Outer Continental Shelf, such as roles related to wind energy projects and offshore oil and gas exploration. The B-1 visa, with the proper annotation, allows these workers to travel to the U.S. for transit to the OCS for non-employment purposes, such as installation, maintenance, or servicing of equipment. 

What types of activities on the OCS are covered under the B-1 visa? 

The B-1 visa covers activities such as: 

• Installation and maintenance of equipment and infrastructure for wind energy and oil projects. 
• Marine logistics and transport of personnel and materials to OCS sites. 
• Routine inspections and repairs of wind turbines or oil platforms. 

However, activities that involve direct labor or replace U.S. workers are generally not allowed under the B-1 visa. 

What are the restrictions for qualifying for a B-1 visa for work on the Outer Continental Shelf? 

To qualify for a B-1 visa for work on the OCS, several important restrictions apply: 

1. Non-employment Role: The B-1 visa is meant for temporary business activities and non-employment purposes. The visa holder cannot engage in direct employment or labor that replaces U.S. workers. Permitted activities include tasks like supervision, maintenance, installation, inspections, and repairs of equipment. 
2. OCS-Specific Annotations: The visa must be annotated for OCS-specific work. For example, for offshore wind projects, the annotation might read “B-1 for Transit or Travel to the OCS for Wind Activities; Not OCS Activity,” or for oil and gas projects, “B-1 for Transit or Travel to the OCS”. 
3. No Displacement of U.S. Workers: The work performed must not compete with or displace U.S. workers. It must be related to foreign-controlled projects on the OCS, such as maintaining equipment or providing support without engaging in the U.S. labor market. 
4. Limited Duration: The B-1 visa is for temporary stays only. The visa holder must show that their stay is for a specific business purpose, such as conducting an installation or inspection, and is limited in duration. 
5. Proper Documentation Required: Applicants must provide documentation, such as a letter from the employer or project sponsor, that clearly outlines the purpose of the visit and confirms that no employment will occur in the U.S. 

Does the Outer Continental Shelf Lands Act (OCSLA) apply to foreign workers on offshore wind and oil projects? 

Yes, the Outer Continental Shelf Lands Act (OCSLA) extends U.S. jurisdiction to the OCS, meaning that workers involved in offshore energy projects, including wind and oil exploration, are covered by U.S. laws, such as the OCSLA and other applicable regulations. This includes protections under laws like the Longshore and Harbor Workers’ Compensation Act (LHWCA) for those engaged in maritime-related activities. 

What are the risks of working in the U.S. while on an ESTA or B visa? 

If a foreign national performs work while in the U.S. on an ESTA or B visa, the risks include: 

• Visa violations: Engaging in unauthorized work violates visa conditions, leading to potential visa revocation, deportation, or bans from re-entering the U.S. 
• Tax consequences: The IRS may determine that the income earned while in the U.S. is U.S. source income, which could result in tax liabilities, even if the individual is paid by a foreign company. 

What happens if the foreign national performs prohibited work while on an ESTA or B-1 Visa? 

Performing prohibited work while in the U.S. on an ESTA or B-1 Visa can result in: 

• Immediate denial of entry by a CBP officer. 
• Deportation if discovered while in the U.S. 
• Visa or ESTA revocation, complicating or preventing future travel to the U.S. 
• Overstaying consequences (if you remain in the US &/or work past your allowed period of stay), which can include a ban on re-entry for several years or even permanently 

What are the consequences of being denied entry under the ESTA? 

If denied entry under the ESTA: 

• You will be detained and sent back to your departure country on the next available flight, often at your own expense. 
• You will be banned from using the ESTA, meaning you will need to apply for a visa for any future travel to the U.S. 
• You must also disclose the denial of entry when applying for future U.S. visas 

How can I minimize the risk of being denied entry under the ESTA? 

To minimize the risk of denial of entry: 

• Ensure that your planned activities are permissible under the ESTA or B Visa. 
• Be honest and accurately describe the purpose of your visit to CBP officers. 
• Understand the difference between permissible business activities and prohibited work under the ESTA or B Visa. 

What are the consequences of overstaying on an ESTA or B-1 Visa? 

Overstaying even by a single day is considered a violation of U.S. immigration law. Consequences can include: 

• Ban on re-entry for several years (3 to 10 years depending on the overstay duration). 
• Permanent ineligibility for future visas. 
• You may also face fines or penalties for the overstay. 

Can U.S. Customs and Border Protection (CBP) search my electronic devices when I enter the U.S. on an ESTA or B-1 visa? 

Yes, CBP officers have the authority to search your electronic devices—including your cellphone, laptop, and other personal electronics—when you enter the U.S. on an ESTA or B-1 visa. This search can include reading your texts, emails, and other forms of communication to ensure you are complying with the terms of your nonimmigrant visa. 

How can CBP misconstrue the purpose of my travel based on what’s found on my devices? 

Even seemingly harmless data or personal information can be misinterpreted by a CBP officer. For example, if your emails or texts mention work-related topics, CBP could mistakenly conclude that you intend to engage in unauthorized employment while in the U.S. This can lead to a finding that you have violated the terms of your visa, even if that was not your intention. 

What are the consequences of CBP finding information that contradicts my stated purpose of travel? 

If CBP believes that the purpose of your travel violates your ESTA or B-1 visa, they may issue an expedited removal order. This can result in: 

• Immediate denial of entry to the U.S. 
• A 5-year ban on re-entry. 
• The expedited removal order is extremely difficult to reverse, and legal options to challenge it are limited. 

What can I do to help mitigate issues with CBP regarding the purpose of my travel? 

To help mitigate misunderstandings: 

• Be cautious about the information stored on your electronic devices that could be misconstrued by CBP. 
• Ensure your communications (emails, texts, etc.) do not inadvertently suggest that you plan to work or violate the terms of your visa. 
• Be prepared to explain the contents of your devices if requested by CBP and have clear documentation supporting the true purpose of your trip. 

What should I bring when entering the U.S. on an ESTA or B-1 Visa? 

It is advisable to bring: 

• A letter from your employer detailing your purpose for travel, itinerary, and confirming your employment with the foreign company. 
• Recent pay stubs from your employer to demonstrate ongoing foreign employment. 
• Copies of your return flight ticket and documents showing the temporary nature of your visit, such as proof of ties to your home country (job, property, family). 
• Documentation of hotel reservations, evidence of scheduled business meetings, trade show or conference registrations, and other such material can also serve as evidence of your purpose for traveling to the US. 
• Be prepared to explain your purpose of travel briefly but clearly to CBP officers at the port of entry 

Can I “reset” my ESTA stay by briefly traveling to Mexico or Canada? 

No, travel to Mexico, Canada, or adjacent Caribbean islands does not reset the 90-day ESTA period. You must leave the North American region entirely to reset your stay. Repeatedly attempting to re-enter the U.S. after short stays abroad can raise red flags with immigration officials 

Does approval through ESTA guarantee entry to the U.S.? 

No, approval through ESTA, or any US visa, does not guarantee entry to the U.S. While ESTA screens for eligibility to travel, final admission is determined by U.S. Customs and Border Protection (CBP) officers at the port of entry. Even with ESTA approval, travelers can still be denied entry. 

U.S. Source Income 

What types of income are considered U.S. source income for non-resident aliens? 

U.S. source income for non-resident aliens includes: 

• Income from U.S. trade or business: Such as services provided or business operations conducted within the U.S. 
• Investment income: Interest, dividends, and rents from U.S.-based sources. 
• Wages and salaries: Income earned from employment in the U.S., even if the income is paid by a foreign employer. 
• Real property income: Rent or proceeds from the sale or exchange of U.S. real estate. 
• Other specific types of income: Including pensions, annuities, or royalties tied to U.S. sources. 

What is considered U.S. source income for wages and salaries? 

U.S. source income for wages and salaries is defined by the IRS as income earned from services performed within the U.S. This applies regardless of where the employer is located, and even if the payments are made outside of the U.S. If a foreign national performs work while physically present in the U.S., the wages they earn for that work are considered U.S. source income, which may make it taxable in the U.S. 

How can a foreign national’s income be U.S. source income if they are working for a foreign company while on an ESTA? 

Even if a foreign national is employed by a non-U.S. company, the IRS determines the source of income based on where the work is performed, not the location of the employer. If the individual is physically present in the U.S. and performs services (e.g., working on a project or fulfilling job duties) while in the 6 

country, the income earned for those services is considered U.S. source income. This applies regardless of whether the company is foreign or whether the payment is processed abroad. 

How does the IRS determine if income earned by a non-resident alien is taxable U.S. source income? 

The IRS determines income as U.S. source based on where the work is performed. If services are performed in the U.S., the income may be classified as U.S. source, even if the foreign national is paid by a foreign employer and even if the payment is made outside of the U.S. 

Does it matter that the foreign national is being paid in their home country for the work done while in the U.S. on an ESTA? 

No, it doesn’t matter where the payment is made. What matters is the location where the services were performed. Even if the foreign national continues to receive their salary in their home country or in a foreign bank account, the IRS considers the income to be U.S. source if the work was done while they were physically present in the U.S. on an ESTA. 

Why is performing work in the U.S. on an ESTA for a foreign company considered U.S. source income? 

The IRS rules are clear that any services performed within the U.S. result in U.S. source income, regardless of who the employer is or where the payments are made. This applies to all foreign nationals working in the U.S., whether they are employed by U.S. companies or foreign companies. When a foreign national enters the U.S. under an ESTA, they are only permitted to conduct limited activities, such as attending business meetings or conferences (passively). However, performing actual work – even for a foreign employer – generates U.S. source income because the services are rendered on U.S. soil. 

What are the potential consequences for foreign nationals performing work while on an ESTA in the U.S.? 

• IRS Tax Liability: Since the income is considered U.S. source, the foreign national may be required to report this income to the IRS and may be liable for U.S. income taxes on the wages earned for work done in the U.S. 
• Visa Violations: Performing work for any company, including a foreign company, while on an ESTA is a violation of the ESTA conditions. The ESTA allows only passive business activities (like attending meetings or conferences), and engaging in work could lead to visa revocation, deportation, and bans from future U.S. entry. 

What risks does a foreign company face for paying a foreign national while they work in the U.S. on an ESTA or B visa? 

• Permanent Establishment (PE) Risk: If a foreign company pays an employee for work performed in the U.S., the IRS may determine that the company has created a permanent establishment (PE) in the U.S., leading to potential U.S. corporate tax obligations. 
• Employment law violations: U.S. labor laws strictly regulate employment. A foreign company may face legal consequences for violating U.S. immigration and employment laws if they allow unauthorized work on ESTA of B Visa. 
• Withholding and reporting obligations: Even if the salary is paid outside the U.S., the IRS may still require the foreign company to withhold taxes or report the income as U.S. source if the work is performed in the U.S. 

How does the IRS enforce these tax rules for foreign nationals working in the U.S. on an ESTA? 

The IRS uses various mechanisms to determine if foreign nationals have earned U.S. source income. This includes cross-referencing tax filings, employer reporting, and immigration data. If a foreign national works while in the U.S. and earns income, the IRS can tax that income regardless of where the payments are made. 

Are there any exceptions to U.S. source income for services performed in the U.S. for a foreign company? 

Yes, there are limited exceptions under which income for services performed in the U.S. might not be considered U.S. source income if all three of the below conditions are met: 

• If the foreign national is temporarily present in the U.S. for less than 90 days during the tax year. 
• The foreign national works for a foreign employer (a non-resident alien individual, a foreign partnership, or a foreign corporation that is not engaged in a U.S. trade or business – i.e. does not have a presence in the U.S. or sell in the U.S.). 
• The total compensation for services performed in the U.S. does not exceed $3,000. If all three conditions are met, the income may be exempt from U.S. tax. 

Are foreign workers subject to U.S. income tax while working on the OCS? 

Yes, foreign workers performing services on the OCS may be subject to U.S. federal income tax and related employment taxes (FICA, FUTA) if their services are related to natural resource exploration or exploitation on the OCS. The U.S. tax law treats services performed on the OCS as work conducted within the U.S. for tax purposes. 

Can tax treaties between the U.S. and other countries provide any relief for foreign nationals performing work in the U.S.? 

Tax treaties between the U.S. and other countries may offer relief from double taxation or clarify the tax treatment of income earned. However, these provisions typically only apply when the work is legally allowed. Since performing work in the U.S. on an ESTA or B visa is generally prohibited, these tax treaties may not offer protection in these cases. 

What are the consequences of creating a permanent establishment (PE) in the U.S.? 

If a foreign company creates a permanent establishment in the U.S. by allowing an employee to work in the U.S., it may face: 

• U.S. corporate tax obligations on income attributable to the PE. 
• Requirements to comply with U.S. tax filing, reporting, and possibly payroll withholding obligations. https://travel.state.gov/content/travel/en/us-visas/tourism-visit/visa-waiver-program.html 

How can foreign nationals avoid U.S. source income tax while on an ESTA? 

To avoid generating U.S. source income, foreign nationals on an ESTA must not perform any work or services while in the U.S. They can attend business meetings or conferences, but active work or services that generate income for their employer could trigger U.S. tax liabilities. 

Additional Resources 

• https://travel.state.gov/content/travel/en/us-visas/business.html 
• https://travel.state.gov/content/travel/en/us-visas/visa-information-resources/visa-expiration-date.html 
• https://travel.state.gov/content/travel/en/us-visas/visa-information-resources/waivers.html 
• https://www.uscis.gov/laws-and-policy/other-resources/unlawful-presence-and-inadmissibility 
• https://www.cbp.gov/travel/cbp-search-authority/border-search-electronic-devices 
• https://www.irs.gov/publications/p519 
• https://www.irs.gov/individuals/international-taxpayers/taxation-of-nonresident-aliens 
• https://www.irs.gov/businesses/industry-directors-directive-2-employment-tax-and-the-employees-on-the-us-outer-continental-shelf 
• https://www.govinfo.gov/content/pkg/PLAW-104publ208/pdf/PLAW-104publ208.pdf 

** The guidance provided here is for informational purposes only and should not be construed as legal advice. 

H-1B Visa and Lottery Process

The H-1B visa category was created by Congress to employ high-skilled professionals in the U.S. by companies with a presence in the U.S.  An H-1B visa can be applied for on behalf of any applicant with relevant skills and at least a bachelor’s degree in a specialized field to work in the U.S.  There is an annual quota of 85,000 set by the U.S. Congress for the issuance of new H-1B Visas (65,000 regular visas and 20,000 visas reserved for this with a U.S. Master’s degree or higher). These new H-1B visas filed are called cap-subject H-1B visas.  Because the demand for H-1B visas is very high, USCIS employs a random selection process called the H-1B lottery to select applicants that meet the annual quota cap.

Who can sponsor an H-1B visa?

An H-1B can be sponsored by a company which is in the U.S. or a multinational company that has operations and offices in the U.S. The company which acts as the sponsor must also maintain a valid employer-employee relationship with the intended H-1B visa holder, called the beneficiary. This relationship is typically indicated by the fact that the company is the entity which has the authority to hire, fire, supervise, or otherwise control the work of the beneficiary. These requirements are often referred to as the “right to control” the beneficiary’s employment. This requirement precludes the sponsoring company from sub-contracting the beneficiary out to 3^rd party companies.  The beneficiary may perform services at an end-client/3^rd party work site, but the end-client can have no supervisory control over the beneficiary’s work or pay the beneficiary directly for their work.

Technically, any company with an office in America can sponsor an H-1B visa.  It can be a company with a few people to hundreds or thousands of people. There are some requirements by USCIS laid out so that the company filing for the visa has the ability to pay the beneficiary as it is the company’s responsibility to make sure the beneficiary is paid in the U.S. as per the U.S. Department of Labor, which is governed by something called LCA (more details below).

What are the requirements a company and foreign worker must meet to qualify for the H-1B?

For the company, the primary qualifications are related to the job which they want the foreign employee to perform, often called the proffered position. This position requires:

• Theoretical and practical application of a body of highly specialized knowledge; and
• Attainment of a bachelor’s or higher degree in the specific specialty (or its equivalent) as a minimum for entry into the occupation in the U.S.

The position must also meet one of the following criteria to qualify as a specialty occupation:

• Bachelor’s or higher degree or its equivalent is the minimum entry requirement for the particular position.
• The degree requirement is common to the industry in parallel positions among similar organizations or, in the alternative, the job is so complex or unique that it can be performed only by an individual with a degree.
• The employer requires a degree or its equivalent for the position.
• The nature of the specific duties is so specialized and complex that the knowledge required to perform the duties is usually associated with the attainment of a bachelor’s or higher degree.

For the foreign employee to be qualified to perform services in a specialty occupation, they must meet one of the following criteria:

• Hold a U.S. bachelor’s or higher degree required by the specialty occupation from an accredited college or university.
• Hold a foreign degree that is the equivalent to a U.S. bachelor’s or higher degree required by the specialty occupation from an accredited college or university (for this, an education evaluation from an accredited evaluation firm is required).
• Hold an unrestricted state license, registration, or certification that authorizes the worker to fully practice the specialty occupation and be immediately engaged in that specialty in the state of intended employment.
• Have education, specialized training, and/or progressively responsible experience that is equivalent to the completion of a U.S. bachelor’s or higher degree in the specialty occupation and have recognition of expertise in the specialty through progressively responsible positions directly related to the specialty (an education/experience evaluation from an accredited evaluation company is required to determine this).

What is an LCA and why is it required?

LCA stands for Labor Condition Application. It is a mandatory document that the H-1B Sponsor or employer must file with the U.S. Department of Labor (DOL) before filing the H-1B petition with USCIS for any non-immigrant worker as per the Immigration and Nationality Act (INA). Employers (or their legal representatives) file H-1B LCA in U.S. Dept. of Labor FLAG System. It takes about 7 days for processing. It is required to ensure that foreign workers are provided with similar wages and conditions as U.S. Workers.

An H-1B LCA form (ETA Form 9035/9035E) has all the key information regarding the offered job, wage details, location, etc. offered to the foreign worker. It has all the below details :

• The job title of position offered
• Standard Occupation Classification Code, called as SOC Code
• Duration of the job position offered (up to 3 years at a time)
• Whether the position offered is full-time or not.
• Total number of positions the LCA is applied for (can be one or any number)
• Rate of Pay / Salary offered for the position
• Location of the job position called as “Place of Employment”
• Is it new or continuing employment
• Prevailing Wage for the same position in that area
• Employer’s & Attorney contact information.
• Is the employer H-1B Dependent or not
• Public disclosure – where LCA will be posted for viewing by public.

The sponsoring U.S. company must post a notice that an LCA and H-1B petition will be filed on behalf of a foreign worker prior to submitting the LCA to the U.S. DOL for certification. This notice must be posted in one or two ways:

1. Hard copy notice in a public location of the employer’s establishments in the area of employment such as a breakroom, common area, or bulletin board or
2. Electronic notice using the same means the employer normally communicates with its workers about internal matters such as job vacancies, promotion opportunities, etc.

The DOL introduced the H-1B LCA to protect the employee’s fundamental rights at work in terms of wages, working conditions, and policies. In the LCA form, employers declare/attest under penalty of perjury that they will abide by the labor laws and be compliant in the below four areas:

1. Pay Prevailing Wage: That the beneficiary will be paid equally, similar to their other employees in that location or the prevailing wage rate in a particular location, whichever is higher for that position, and the beneficiary needs to be paid during non-productive time. Also, provide the same benefits as regular U.S. workers.
2. Working Conditions, Hours: That the employer will provide same working conditions as U.S. workers and employing the beneficiary will not adversely impact the working conditions at the location, especially hours, vacation time, shifts, etc.
3. Strike or Lockout Info: That there is no strike or lockout or any other work stoppage for the named occupation in the place of employment during filing of LCA.
4. Post LCA Notice, Share to Union, Employees: The employer will provide a copy of the LCA to the employed workers in that location and will also provide a copy to a union, if any. Also, post the LCA in two conspicuous locations where the H-1B worker will be employed or distribute through electronic notification for the employees in that location.
5. Official Regulation H-1B LCA: If you want additional details on the above rules and more info, you can read official regulation on LCA at INA § 212(n)-(p) on US DOL website (https://www.dol.gov/agencies/whd/laws-and-regulations/laws/ina/h1b) .

When can you file the H-1B visa petition and for how long does USCIS accept petitions?

New H-1B visa applications for someone applying for the first time can only be done once a year during a defined time window (unless the U.S. company is cap-exempt). In general, you can only file for an H-1B visa 6 months before the start date of the beneficiary’s actual work start date. The USCIS fiscal year is from October 1^st to September 30^th of next year, 6 months before Oct 1^st is April 1^st.  Now, with the H-1B Registration Process, usually, the submission date for H-1B registration process is in the month of March of every year.  It varies by year. After the registration process, the selected applicants are informed by the end of March and they can file H1B petition between April 1st, and June 30th. If the applicant is not selected, USCIS will not notify them.

USCIS accepts H-1B visa applications until the quota is complete for that year. In the past, they used to accept applications for a minimum of 5 days and for up to a few months, depending on the demand to meet the quota cap of 85,000. However, this changed with the introduction of the H-1B registration process, but it is very common for USCIS to select more registrations during the lottery than there are visas available on the assumption that not all the registrations selected will actually qualify. This means that getting the H-1B petition filed as soon as possible after being selected provides the best chances for petition approval.

What happens after H-1B selection and petition approval?

If the employee is selected for the H-1B registration, they are now free to file the H-1B petition with USCIS. The petition must contain the required forms and documentation to demonstrate that the company, the proffered position and the beneficiary all meet the H-1B requirements. With H-1B cap-subject visas, the start date is always October 1^st of that year (due to the USCIS fiscal year). This is the date the beneficiary will be granted H-1B status and legal work authorization based on this status.

Assuming the petition is approved by USCIS and the beneficiary is outside the U.S., the beneficiary will then use the I-797 Approval Notice from USCIS to complete the DS-160 online and make an appointment at a U.S. embassy or consulate abroad for the H-1B visa stamp in their passport. This interview should take place no more than 6 months prior to the October 1^st start date (July 1^st). The timing of the interview and the processing of the visa stamp will depend on the U.S. embassy/consulate being used.

Assuming the petition is approved by USCIS and the beneficiary is already in the U.S. in another immigration status, the beneficiary will officially change their status to H-1B on October 1^st. Nothing is required by the beneficiary at that time – the status change is automatic. However, if the beneficiary leaves the U.S., they will need to use the I-797 Approval Notice to complete the DS-160 and schedule an interview at a U.S. embassy or consulate to obtain a visa stamp in their passport. Without that visa stamp, they will not be allowed back into the U.S. in H-1B status and therefore will not be legally allowed to work.

Summary of H-1B Registration Process

Usually, USCIS announces the exact dates for the next H-1B Registration/Lottery Process during January of that year, so the dates in the below chart are an approximate timeline.

See the USCIS website for more information:

https://www.uscis.gov/working-in-the-united-states/temporary-workers/h-1b-specialty-occupations-and-fashion-models/h-1b-electronic-registration-process

Termination of an H-1B Worker

The H-1B visa category has a number of employer obligations built into the terms of the visa and the regulations, and this holds true even if an employer wants to terminate the H-1B worker/visa beneficiary before the end of the visa.

There are 4 key steps the employer needs to take when terminating an H-1B worker:

• Confirm the termination in writing to the beneficiary and inform them of their last day.
• Send a letter to USCIS confirming that the employer/sponsor would like to withdraw the H-1B petition once the employment officially ends, but not before it ends.
• This is because employers are required to pay wages to the beneficiary as long as the petition is in effect.
• Withdraw the Labor Condition Application (LCA) with the U.S. Dept. of Labor (DOL) via the iCERT Portal System. This can also be done via email or written notice if the employer does not have access to the electronic LCA through the Portal.
• This is a legal obligation and not withdrawing the LCA can result in a penalty for back wages under the LCA agreement.
• Offer to pay the beneficiary the reasonable cost of return transport to their home country (and this offer should be documented).
• This obligation only arises if the beneficiary departs the US. If the beneficiary transfers to a different employer, there is no obligation to pay the cost of return transportation.
• This offer can also be built into the beneficiary’s employment contract if the employer chooses, but it should be revisited upon the termination of the beneficiary.

Failure to take these steps can result in a continuing obligation to pay the beneficiary’s wages and gives the beneficiary the ability to submit a complaint to the U.S. DOL.

It’s important to note that even after the above steps have been followed and the termination has occurred, the employer still needs to maintain the Public Access File (PAF) for one year beyond the date of LCA withdrawal or employment(whichever is longer).

E-2 Visa Validity Legal Immigration Status (website version) [2024 final]

Unlike most U.S. work visas, the E-2 visa validity depends on the principle of reciprocity and is determined by the person’s country of nationality. This means that the visa stamp’s validity period will differ depending upon the nationality of the person applying for it. For example, the E-2 visa for a Danish citizen is valid for 18 months whereas an E-2 visa for a Dutch citizen is 36 months or 60 months for a UK citizen.

The reciprocity schedule can be found on the U.S. State Department’s website – https://travel.state.gov/content/travel/en/us-visas/Visa-Reciprocity-and-Civil-Documents-by-Country.html

• Use the alphabet filter near the top left corner of the page to navigate to the list of countries by alphabetical order.
• Find your country in the list below this alphabet chart and click on it.
• In the Visa Classifications chart, click on the box with the “E”
• This chart will tell you the reciprocity fee for the E-2 visa as well as the E-2 validity period.

However, while the validity of the E-2 visa stamp is determined by reciprocity, the length of time an E-2 visa holder is allowed to remain in the U.S. at one time is usually 2 years from the date of the person’s most recent entry to the U.S. (even if the E-2 visa stamp will expire during their stay in the U.S.). To put this another way, an E-2 visa stamp permits a person to enter the U.S. from abroad, but it does not determine how long the person may remain in the U.S.

• Each time you enter the U.S. from abroad on your E-2 visa, you should be admitted for 2 years from the date of your entry (unless you enter the U.S. from Mexico or Canada (or potentially some Caribbean nations) after being there for less than 30 days).
• When you go through the passport control upon your entry to the U.S., the U.S. Customs and Border Protection (CBP) officer may stamp your passport. However, CBP is transitioning to digital I-94s, so many airports are no longer physically stamping and writing in the expiration date by hand.
• If you do not have a handwritten date in your passport telling you how long you can remain in the U.S., you will need to obtain a copy of your digital I-94 in order to determine this date. The I-94 is the electronic admission record created by the CBP officer upon your entry to the U.S.
• Each time you enter the U.S. on your E-2 visa you must access your admission form I-94 online to check your allowed time in the U.S.
• To access form I-94, you will need to go to https://i94.cbp.dhs.gov/I94/#/home and select “Get most recent I-94”. Save this form for your records. I-94 will be available only after you enter the U.S.
• You will be able to re-enter the U.S. from abroad on your E-2 visa for as long as your E-2 visa stamp in your passport is valid. If you wish to renew your E-2 visa, this will require submitting an E-2 visa application to a U.S. Embassy/Consulate again.
• Your E-2 status in the U.S. is tied to your employment at the sponsoring U.S. company. You are not allowed to work for any other company.
• Your E-2 status is also tied to the ultimate ownership of the U.S. company. Should changes in the overall corporate structure and company ownership occur, it may invalidate your visa.

The below E-2 visa stamp is for a Danish citizen and therefore is valid for 18 months. The expiration date of the stamp has been circled in red.

The below image is the same person’s digital I-94 from his entry to the U.S. in E-2 status. The I-94 grants the E-2 visa holder legal E-2 status in the U.S. until October 14, 2024 (also circled in red), 2 full years from the date he entered the U.S.

E Visas: A Viable Pathway to U.S. Work Visas for Entrepreneurs and Companies

By: Olga Quinones, LL.M. Martensen Wright PC, and Anne Grethe Martensen, MBA, HA (Jur.) 

Getting a U.S. work visa can be challenging for individual foreign entrepreneurs and for foreign companies that wish to send their personnel to work in the U.S.

Most U.S. work visas require a job offer from a U.S. company. This requirement cannot be met by individual entrepreneurs. As far as the companies are concerned, they often have to comply with ever tightening requirements of Intra-Company Transfer L-1 visas or face the limitations of the Specialty Occupation H-1B visas before they can employ foreign personnel in the U.S. The E visa option is frequently the only viable option for individual entrepreneurs, and it is often the best solution for companies who need to relocate some of their key employees to the U.S.

There are two types of E visas: E-1 Treaty Trader Visa and E-2 Treaty Investor Visa. Both types of E visas are based on Treaties of Commerce and Navigation between the U.S. and foreign countries (“Treaty Countries”). Denmark, Norway and Sweden are three of the countries which maintain the above Treaties with the U.S., which allows citizens from these countries to apply for E-1 and E-2 visas. A full list of Treaty Countries can be found on the website of the U.S. Department of State:
https://travel.state.gov/content/travel/en/us-visas/visa-information-resources/fees/treaty.html

Benefits of E visas:

• E visas allow foreign entrepreneurs to come to the U.S. to start a business or to purchase and develop an existing U.S. business.
• E visas can be extended as often as needed, potentially indefinitely, as long as all the requirements continue to be satisfied.
• It is important to note that the E visa itself does not lead to permanent resident status (a.k.a. Green Card), irrespective of how long the individual has lived and worked in the U.S. in E status.
• The validity period of E visa stamp issued by the U.S. Embassy is determined by reciprocity agreements between the U.S. and the Treaty Country. Citizens of some countries may have an E visa validity period of 18 months whereas citizens of other countries may have up to five years. It is important to check the reciprocity schedule prior to applying for an E visa as the validity period may change. This can be done via the State Department website (https://travel.state.gov/content/travel/en/us-visas/Visa-Reciprocity-and-Civil-Documents-by-Country.html)
• E visas allow for the transfer of essential employees to the U.S., including employees who have been employed with a foreign parent or affiliated company for a short period of time (less than a year) or have not been employed with the foreign company at all prior to the transfer
• Spouses of the E visa holders are automatically authorized to work for any U.S. Company once the dependent spouse is admitted to the U.S. in ‘E2S’ dependent status.
• E visa allows the visa holder to travel to the U.S. from abroad during the validity period of the visa stamp in their passport. The validity period of the visa stamp does not determine how long time the individual is allowed to stay in the U.S. The period of allowed stay in the U.S. is determined by the U.S. Customs and Border Patrol authorities (CBP) upon the individual’s entry to the U.S. E visa holders are typically allowed to stay in the U.S. for two years from the day of their last entry, regardless of the visa stamp expiration date.
• If an E visa holder does not plan or want to travel outside the U.S. after their E visa stamp expires, they can apply for an extension of their E status in the U.S., without having to apply for a new E visa stamp at the U.S. Embassy. Extensions of stay in the U.S. are processed by the U.S. Citizenship and Immigration Services (USCIS) and are typically granted in two-year increments. Extension of stay in the U.S. can be granted even after the expiration date of an E visa, as long as the extension application is filed before the expiration date of the admission period on the I-94 arrival/departure form.
  • However, if an extension of stay is granted, it is only valid while the individual is in the U.S. If this individual travels outside the U.S. after their E visa stamp expires, they will need a valid visa stamp before they can travel to the U.S.
  • The visa stamp renewal process requires a new E visa application processed by a U.S. Embassy abroad. The U.S. Embassy is not bound by the USCIS approval of E status extension.

The Basic Requirements for Both E Visa Types:

•  The U.S. Company must ultimately be at least 50% owned by citizen(s) of the same Treaty Country as the visa applicant’s country of citizenship. It is important to note that ownership is traced to the ultimate individual owners of the business.
  • Foreign citizens who are permanent residents of the U.S. (Green Card holders) cannot serve as qualifying owners for the purposes of E visa applications.
• The visa applicant must demonstrate an intent to leave the U.S. after the termination of their E visa status. Note: This does not preclude the applicant from ultimately applying for a Green Card if a separate basis for the Green Card application exists, but it does mean the visa application cannot complete the Green Card process from within the U.S.

E-1 Treaty Trader Visa

The specific requirement for an E-1 visa is that the Treaty Trader (individual or company) must have established “substantial trade” in goods or services between their country of nationality and the U.S. To be considered substantial, this trade must constitute at least 50% of the company’s or individual’s total international trade. This trade requirement may be fulfilled either by the foreign individual, foreign company or by the U.S. subsidiary that will serve as the employer of the intended visa holder.

Notes regarding Qualifying Trade:

• Trade between the foreign country and the U.S. must be in existence before the visa application can be submitted for processing. Trade includes both export and import of goods and/or services.
• If the company is trading goods, the goods must be manufactured in the applicant’s country of nationality (Trade Country), shipped to the U.S. from the Trade Country and invoiced in the Trade Country to count as trade for E-1 visa purposes. Alternatively, the goods can be manufactured in the U.S., shipped from the U.S. to the Trade Country and invoiced in the U.S.
• Substantial trade is determined by the number of transactions over time, not only by the dollar amounts. For example, one transaction will not qualify as substantial trade, even if it involves a large sum of money.
• Typically, US Embassies require substantial and detailed documentation in regard to the company’s international trade to satisfy the E-1 visa requirements. Such documents include, but are not limited to, bills of lading, invoices, bank account statements and other documentation showing transactions between the two countries.

Note Regarding the Visa Applicant’s Position in the U.S. Company

The visa applicant must be coming to the U.S. to be employed in a supervisory, executive or specialized capacity.  Ordinarily skilled or unskilled workers do not qualify for E-1 visas.

E-2 Treaty Investor Visa

As the name suggests, an E-2 visa is based on investment. This type of visa requires a substantial investment to be made in the U.S. Company by a foreign individual (often, but not always, the visa applicant) or a foreign company that has the same nationality as the visa applicant.

Notes regarding qualifying investment:

• Qualifying Investment must be “substantial,” and the funds have to be irrevocably committed. “Substantial” is not defined in the visa regulations. Typically, if the U.S. Company is new, we see success with an initial investment of $80,000 – $100,000.
  • The investment must be sufficient to ensure the successful operation of the U.S. enterprise, and this amount is typically relative to the type of enterprise.
• The investment must be made into qualifying categories of expenses related to the U.S. Company. Uncommitted funds in a bank account or mere ownership of undeveloped land are not considered an investment.
  • Specific types of qualifying expenses often depend on the type of business.
  • Examples of expenses for E-2 visa purposes include, but are not limited to, U.S. office infrastructure, inventory on hand, equipment, company cars, marketing expenses, recruiting expenses, and one-month’s office rent.
• The investment may not be marginal, meaning that the U.S. enterprise must have the present or future capacity to generate more than just the income needed to provide a minimal living for the treaty investor (or the employee of the investor) and their family.
  • The U.S. business must demonstrate a realistic need and plan to hire U.S. employees and a realistic potential for a financial return that significantly exceeds what is necessary to support a living for the visa applicant and his/her family.
  • While there is no specific mention of job creation in the visa regulations, this requirement is the core of why the E-2 visa exists.
• The investment must be ‘at risk’ in a commercial sense. If the investment funds are not subject to partial or total loss if business fortunes reverse, then the investment does not qualify to support an E-2 visa application. Loans secured with the assets of the U.S. enterprise do not qualify for E-2 visa purposes, nor does simply transferring money to a U.S. bank account

Note Regarding the Visa Applicant’s Position in the U.S. Company:

If the visa applicant is the principal investor, this individual must be coming to the U.S. to develop and direct the U.S. enterprise. If the applicant is a prospective employee of the U.S. company, this applicant must be employed in a supervisory, executive, or specialized capacity. As with the E-1 visa, ordinarily skilled or unskilled workers do not qualify for E-2 visas.

If you have questions or would like further information on E visas, please feel free to contact Martensen Wright PC at info@usa-eurolaw.com.

Business Visas and Green Cards

Setting up in the U.S.? Then you are investing capital, know-how, and your company’s reputation. Few companies trust that process to a stranger. Businesses entering the U.S. market for the first time almost invariably want trusted personnel at the helm or experienced technical support involved. To bring that support to the U.S., you will need visas and/or Green Cards.

Because Martensen Wright PC assists with your broad business goals – – from corporate formation to closing key transactions – – we are especially well placed to serve your business immigration needs. Your eligibility for a Treaty Investor (E-2) visa may hinge upon how you fund your start up, and at what levels. You need to know this up front. Whether or not management or key personnel may qualify for an L visa may well depend on the role the individual holds in the parent corporation and the new start up, along with their experience and education. You need to know this before you create positions or select personnel.

Over the years, our immigration professionals have handled hundreds of visa applications to the United States, and likewise have obtained permanent residency (Green Cards) for many clients who have decided to stay in the United States on a more permanent basis. Also, we have assisted U.S. businesses in having Americans stationed in Denmark on a temporary basis.

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