
International Entrepreneur Rule - buechs
https://www.federalregister.gov/documents/2017/01/17/2017-00481/international-entrepreneur-rule
======
Finbarr
Reading through it. The gist is you can get 30 months of parole from USCIS if
you are a startup entrepreneur that has raised investment. Seems like the
threshold is $250k and it can support up to 3 founders. You must own at least
10% to be considered a founder.

Looks like you can also get an additional 30 months by raising a further
$500k, or having at least $500k ARR with 20% annual growth, or employing 5 US
persons full time. You need to maintain a 5% stake and continue to serve a
central role in operations in order to qualify for the additional 30 months.

The investment has to be raised from investors with a track record of
investing in high growth startups.

This will come into force from July 17 2017.

~~~
cma
One thing that will let you in is if you are invested in from

> investors with established records of successful investments

The rich get richer. Established investors get cheap labor, while upstart
competitive investors get buried behind an artificial government wall. I
wonder if any established investment firms lobbied for that?

~~~
lend000
Same with hedge funds. Government 'protects' the average investor by only
letting qualified rich people invest in hedge funds (and get richer). I love
how the government asserts that it knows what's best for me and protects me
from myself. Such a free nation we live in.

~~~
bsder
> Government 'protects' the average investor by only letting qualified rich
> people invest in hedge funds

Having dealt with this situation recently, I'm a little more sympathetic to
the government's position.

Most investors are dumb. Really dumb. No, dumber than that.

It's really easy for a con man to set up shop. It takes _forever_ to get him
shut down, and the scammed will fight you.

Scammed investors will _defend_ the scammer even when you present them with
incontrovertible proof. You can stand in court and have a judge hand down
rulings of the level of "worst case I have seen" and they will _STILL_ defend
him.

Preventing these kinds of "investors" from even getting into the game is
really the only way to keep it under control.

Trump being elected was hardly a surprise to me given my recent experiences
with dumb investors.

~~~
lend000
Sounds like a problem with a different part of the system (too many legal
protections to effectively shut down ponzi schemes/cons/etc.). In general,
I've never heard a compelling argument that the government should pass laws
that limit people's freedoms, solely for the purpose of potentially defending
people from their own willful decisions that affect only themselves.

~~~
bsder
> too many legal protections to effectively shut down ponzi schemes/cons/etc.

The problem is that the the person carrying out the scam is playing with
"house money" while the ones trying to stop him are paying cash. He is paying
lawyers with the money from the investors and burning up the assets. So, by
the time you are done, it may be a Pyrrhic victory.

~~~
lend000
How many hedge funds fall into this category of scammers? And with our
protective legal framework, how come you still had to deal with a situation
like this?

Not only do I dislike the freedom limitations _in principle_ , but I've been
giving everyone the benefit of the doubt that limiting freedoms will actually
prevent the targeted type of scams. In reality, scammers will always find a
way, criminals are not bound by laws, and we're still stuck with the inherent
flaws of only giving the rich access to wealth-generating funds.

------
beagle3
Ok, that's the immigration side. What is the tax status of people admitted
under this rule? IIRC, only F and J visas are exempt from becoming American
taxpayers

Being an American taxpayer is fine and dandy if you never plan to live outside
the us again; but if you aren't, it's a very expensive and labour intensive
deal; your home country bank will fire you as a customer because of FATCA, the
reporting requirements to the us are insane (FBAR and every single foreign
transaction needs to be reported), and your e.g. Pension savings and other
holdings likely become a losing proposition because they are PFICs.

Most people ignore these issues, but almost everyone is liable under the us
tax code, and especially with the just announced sharing of NSA data with the
IRS, it will all be legally documented for the IRS to pursue.

~~~
FallujahJane
Holders of F and J visas do pay taxes in the US, though they may also be
liable for taxes in their home countries. (Depending on treaties with their
home countries, they may or may not be better off than a regular US taxpayer.)

You may be thinking of the rule requiring American citizens to pay taxes over
their worldwide income, not only their US income. That rule applies to
American citizens as well as permanent residents ("green-card holders"), but
generally not to anyone in the US on a temporary visa. That means that someone
in the US on a temporary visa will generally be paying US taxes over any
income from a job or business they have in the US, but if they have, e.g.,
income from renting out real estate in another country, that income may be
taxed in that other country, but not in the US. Only US citizens and permanent
residents are required to report any such foreign income in the US and pay
taxes over it, even when they move abroad (with some exemptions).

FATCA is not as onerous as you describe for most regular people. As a US
taxpayer (whether a citizen or permanent or temporary resident), you have to
report foreign bank accounts that at any point during the year contain more
than the equivalent of something like $10,000. That's it. There is no
requirement (as far as I'm aware) to report "every single foreign
transaction."

You're right that retirement planning can be complicated for immigrants and
temporary visitors. Many countries have rules like the US, where you have to
pay into the system for a certain number of years before you become eligible
for social-security payments in old age. So for many immigrants retirement
becomes a patchwork of sources (a bit of social security, a bit of foreign
social security, and otherwise savings in whatever accounts are available in
the US and abroad.)

~~~
beagle3
> You may be thinking of the rule requiring American citizens to pay taxes
> over their worldwide income, not only their US income. That rule applies to
> American citizens as well as permanent residents ("green-card holders"), but
> generally not to anyone in the US on a temporary visa.

It is indeed what I'm thinking about, but I believe you are wrong about the
"temporary visa" thing - As far as I know, only F and J visas (inherently
temporary) are exempt; H-1B, L-1, E-1, O and K visas which are temporary in
the sense that they expire on job termination / divorce, but they still
subject you to taxation of your worldwide income.

> There is no requirement (as far as I'm aware) to report "every single
> foreign transaction."

There is a requirement to report the details of every transaction that has
capital gains and losses associated with it, if that transaction did not
happen in the US.

A few years back, I got a call from my foreign bank one day, saying that
because I was a US taxpayer (for several years, at that point, well documented
with the bank), they could no longer maintain any of my accounts other than
checking and saving. At that point, my bank was also my broker keeping some
long term bonds, stocks, mutual funds, etc. So, they had me choose whether I
want to transfer them to a SEC-regulated bank/broker (impossible - non had the
facilities), or liquidate them -- which is what I did.

Had this been done in the US, I would just have to report aggregate capital
gains/losses. and that's it. However, as this was outside the US, I had to
fill a 2-page form describing every liquidation transaction that the bank did.
I ended up filing north of 300 pages that year. "Luckily", now I can't
purchase any of these securities so that won't happen again, except ....

> You're right that retirement planning can be complicated for immigrants and
> temporary visitors.

No, I'm not talking about retirement planning, which is indeed complicated.

Almost every country has a pension saving system independent of the social-
security (or equivalent) system. In the US, for example, it is IRAs and 401K.
These things get preferential tax treatments, usually "no tax (up to some
limit) as long as you only cash it when you retire". However, the US does not
recognize any other country's preferred retirement saving. Those savings are
in 99% of the cases, a PFIC from the perspective of the US tax system.

Which leaves you with three choices: Either cash it, retroactively forfeiting
any tax benefit (possibly 20 years of it), and move it to a US equivalent; Or
.. pay a tax each year on the theoretical profit of those pension accounts ...
or, pay a lump compounded interest-and-penalty tax the day you actually cash
it, which will likely be 50%-100% of that sum.

Now, if you've moved to the US for good, then, by all means, you have to take
the hit to switch systems. However, if you can't guarantee that you can stay
forever, all your options regarding taxation of your pension saving are awful.

~~~
piotrkaminski
> However, the US does not recognize any other country's preferred retirement
> saving.

This is not completely true: Canadian RRSPs are recognized by the IRS at the
federal level due to a tax treaty, though may not be recognized by all states.
(For example, I had to figure the interest on the investments for my
California return, until I decided to sell the RRSPs to simplify my life.)
Other countries may get special treatment for their tax-deferred retirement
accounts via a tax treaty too, though it can be tricky to ascertain -- you may
end up actually having to read the treaty!

------
forgottenacc57
This will be gamed hard by rich people to get into the U.S.

Essentially a red carpet side door if you have a slab of cash.

~~~
franciscop
I am not native English speaker so I might be misreading, but isn't _parole_
meant to be for people in prison? So how does this have anything to do with
getting into the U.S.?

There _is_ already something like what you are suggesting in the U.S. AFAIK,
just $500k or $1M depending on the situation.

~~~
emilyfm
Parole is a term used by immigration for cases where they use their own
authority to let someone in when the law doesn't quite allow it.

For example in late 2000 the US government didn't get around to renewing the
"visa waiver" law in time. Rather than suddenly requiring visas from everybody
from the former visa waiver countries (and cause travel chaos), passports were
stamped "PAROLED" for visa waiver people (mostly tourists) entering until the
law was renewed. (I had a stamp like that in October 2000).

------
xolb
This is good news for YC, and I bet that the amount of international founders
accepted will increase in the next batch.

------
nikon
Should you not be offered some sort of permanent residency in return for
"growth and job creation that they would provide a significant public benefit
to the United States", especially after the first 30 months?

So you get 60 months and then have to leave the country? How is that
attractive?

~~~
hkmurakami
People usually convert themselves to H1B at some point in the process.

------
trvlngsalesmn
When was this passed?

~~~
tingletech
it is a regulatory action, so it was never "passed" per se.
[https://en.wikipedia.org/wiki/Rulemaking](https://en.wikipedia.org/wiki/Rulemaking)

it is post-dated next tuesday, I didn't know could post-date a rule

~~~
xenadu02
Because it isn't legally "published" until the next business day and Monday is
a federal holiday.

Federal law says rulemaking isn't valid until 180 days have passed so it kicks
in July 17.

All of these rules are to keep federal agencies from changing the rules out
from under people, and to give Congress/Courts time to act.

~~~
trvlngsalesmn
Interesting. Thanks for the background and links. So this is how federal
agencies that report to the executive branch legislate. I had always wondered
what the actual process was.

~~~
tingletech
They don't "legislate" they "regulate".

------
SwaroopH
The status is iffy and still no easy path to a permanent residence. They
recommend the usual route of O-1A or EB-2 and no adjustment of status either.

------
gcb0
everyone should remember this is the port of entry body. allowing them to
decide in case of urgency makes sense fully.

entrepreneurs already can request a visa in their home country usa embassy.

why the people validating documents at the airport should now decide on
startups sounds crazy at least.

------
throw345hn
Does anyone know if you could apply for permanent residency while on this
visa?

~~~
ricardonunez
No, you can't. This is not a visa.

~~~
Finbarr
You can apply for any kinds of visa you want while taking advantage of the
parole according to the linked article. You would need to leave the US to
change status though.

------
general_ai
250k is way too low a threshold. I'd put it at at least a million, if not
more. But hey, it'll all be repealed shortly anyway, so who cares.

