Feel free to run this by an immigration lawyer if it matters to you, but "Opening an LLC is legal regardless of immigration status" is true. It doesn't imply that working for your own LLC is legitimate absent a work-capable visa. The Times is mostly reporting on a way which currently avoids controls designed to make working illegally (which is, ahem, not uncommon) more difficult.
In a similar fashion, owning a LLC makes it radically easier to not pay income taxes than being a W-2 employee, but it does not excuse you from paying income taxes.
The analysis from patio11 is essentially correct. It is NOT legal to be living in the United States unless one has a citizenship or visa status that allows doing so. What forming an LLC does is avoid many of the enforcement mechanisms that reveal persons who are in the United States illegally. But if you are found anyway, nothing about forming the LLC will protect you from being deported. You don't gain an immigration status by forming the LLC--what you gain is a way of making a living. If you are making a living in the United States without work permission, you are still an illegal immigrant. Simply put, the newspaper headline is WRONG--there is nothing legal about working in those circumstances.
(Obligatory disclaimer: I am simply describing the immigration law of the United States as it is, not as I might desire it to be.)
For example: As a student you can have an expired F1 visa in your passport, but as long as your I-20 document is kept valid and you are attending school you are fine. The visa is only of concern when crossing the border.
This also applied for regular B visas, if it expires on day X you have until day X to cross the border, but the maximum duration of your stay is determined by the officer, regardless of the remaining visa duration.
Exactly you do not need a Visa to be in status. Another example of valid status without the need of visa is I-485 pending status. Lots of people who have applied for i-145 ( adjustment of status from non immigrant to immigrant) are legally allowed to be in the US and enter the US without Visa.
I think there's a fuzzy line, but that fuzziness could be in my own head.
In my LLC I had no employees. My company made money, and I did an owner's draw when I wanted money from the company.
I worked, but I didn't work as an employee. The work laws target employees, not owners, and I think that's the distinction the article is trying to make.
Every country that limits immigration (most) makes limits on working in the country without proper status. The United States immigration statutes and regulations most certainly do NOT say that a foreign person without proper visa status may form an LLC and then work here. That may not be the easiest part of immigration law to enforce, but the newspaper headline says "legally," and that is just flat wrong.
Yes, I understand and agree with the first sentence. The fuzziness is in what those limits are.
The first person mentioned, Carla Chavarria, is not a legal resident of the US, but she "obtained a two-year reprieve from deportation under the Obama administration's deferred action program." She does not have proper visa status. We are agreed on that.
Foreigners can own a US LLC, independent of their visa status. Therefore, she is allowed to own a US LLC. Owners of an LLC can draw money from the LLC. Therefore she can draw money from her LLC. Are we agreed upon that?
What then is the illegal part about the way that she makes money from the work that she does?
"most certainly do NOT say that a foreign person without proper visa status may form an LLC and then work here"
Since a foreign person without proper visa status may form an LLC, the key part is the "and then work here." I agree with you that her LLC is not a reason to let her stay in the country. She gets to stay in the country because she has a two-year reprieve.
In that case, starting an LLC is a way to make it possible for her to get money, based on her work as owner of the company.
So if "work" is broadly defined to include work done by non-employees (eg, owners), then she's legally making money from her work, no?
While located in the USA, you cannot do any sort of work unless authorized by your visa to do so unless it's like the B-1 telecommuter (getting paid by a non-us source into a non-us bank account). That includes unpaid and/or volunteer work.
That theoretically means it's illegal for a guy on a H1B to contribute to open source projects independently of his employer, fix his car, etc. Nobody gives a shit about that stuff in practice although.
Someone in the US without a visa that allows work is definitely allowed to do volunteer work, with restrictions. The major restriction is that it cannot be work that someone else would get paid for.
> VOLUNTEER: A person skilled in computer programming volunteers his/her services to a nonprofit/charitable organization such as a substance abuse counseling center to help them design a computer based intake system to log their calls. While the "work" of computer programming would normally be a paid activity, note that in this circumstance it is performed for a nonprofit/charitable organization which traditionally depends on "gifts in kind" (items, resources, or services donated) to conduct its business. The programming is a gift of time and talent to an organization that depends on such gifts, with no expectation of payment or a future job.
But if you are a principle or officer of a US-based company, surely you aren't required to stop your work just because you are in the country. The duties haven't changed.
It's slightly different if you have a contractor who must do billable work only when out of the country. Otherwise you couldn't do sales on a business visa, nor could you discuss a possible joint venture when visiting a friend on a tourist visa. So I don't think the courts would hold the rules to be that inflexible.
A b-1 visa allows consulting with business associates. Isn't this pretty much something that allows corporate officers to do pretty much all duties of corporate officers? I mean what can't they do in this case?
The point is that the visa is required to perform the work. There's no exception for "corporate officers", it's still work, and you must have a visa for it. I use the existence of the B-1 to demonstrate this.
How do you distinguish between salaried top level management work and suspending that work (still remaining on salary though) while "consulting with business associates." Inquiring minds want to know.
I didn't say you needed to. I used the B-1 to point out that a visa is required even for things that could be considered "top level management work". No visa, the work is illegal. If you have a B-1 visa, obviously some "top level management work" is thus authorized. What part of this is so difficult to understand?
But the B-1 allows you to consult with business associates according to the link you provided. For a salaried worker whose work can be easily considered to be nothing more than "consulting with business associates" (i.e. a CEO, CTO, and the like), it seems you can:
* Show up
* Attend meetings
* Tell people what they should do
* Conduct business
That's what a B-1 is for. Now, my question is why that suddenly applies differently for a director who may be offering such services without direct compensation other than travel expenses than it would, say, the CTO?
And if the government were to admit the director doesn't need anything more than a B1 to attend the directors' meetings, they had better be able to say what makes that different from the CEO other than pay.
Now, none of these address residency which is where I think you'd have to draw the line since there is no relocation involved. Now, I suppose you might say "should != must" but that ends up being really weird.
Here's my hypo. Suppose a US company ends up having a CEO in Canada. The Canadian CEO travels to the US once every year for the director's meeting and a meeting with top-level employees. My contention is that a B-1 (or VWP entry) would be sufficient.
Yes the B-1 would be sufficient for a director, board member, significant stockholder, etc to do such work legally. The thing is, B-1 visas expire, you can only be in the country for 3 months at a time, maximum 6 months a year.
The lady in the article is not covered by the B-1 immigration status since whatever visa or authorization (if any) she had has long since expired. By law she supposed to remove herself immediately from the country, get deported, etc.
Bring to mind:
A frind of mine plans and builds equipment for expos. When he went over to the US he brought all finished work and plans but was required to hire someone to assemble it :/
Many conference venues have workplace rules which prohibit vendors from setting up their own booths. Eg, quoting http://www.pacvet.net/doc.asp?id=264, selected arbitrarily:
> All work performed in the exhibit area is under union jurisdiction and under safety jurisdiction. Show management and all exhibitors are expected to comply with the unions and with fire and safety requirements in effect.
> All work involved in the construction, touch-up painting, dismantling, and repair of all exhibits may fall under union jurisdiction. This work is to include wall coverings, floor coverings, pipe and drape, painting, hanging of signs and/or decorative materials from the ceiling, placement of all signs, and the erection of platforms used for exhibit purposes.
> Full-time employees of exhibiting companies may setup their own exhibits provided that one person can accomplish the task in less than one-half (1/2) hour without the use of tools.
So, was that restriction you mention based on US immigration restrictions, or on local venue restrictions?
I actually suspect that if she was deported, she could probably move just to the other side of the border, and use NAFTA Professional Services visas to come to client's sites in the US, and continue making money, this time without paying income taxes.
The L visa for multinational managers or intracompany transferees is possibly more suitable assuming that she has already hired a few people and would have some revenue to show. She can also possibly file for an O visa on grounds of extraordinary ability in arts or business given her circumstances, with a waiver that essentially asks the US government to overlook her immigration law violations…
1. Is it legal to be living in the US? No, in that case (you are correct)
2. Does it break additional laws to be working in the US in this situation? I doubt it. Traditionally there is a distinction between "employees" and "corporate officers."
Law has namespaces. What "employee" means for labor law can be different from what it means in tax law, which might be unlike what it means in corporations law, which can differ again from immigration law.
Sometimes these differences create loopholes. Most often, though, they just create the illusion of loopholes.
Understanding the law in its correct context requires a lot background knowledge on each particular body of law, which is why it's always worth consulting with a lawyer when stuff like your personal freedom is on the line.
The immigration laws do not distinguish based on the label you attach to your employment status. A non-citizen cannot legally perform work in the United States without an immigration status that explicitly allows it (e.g. permanent residency or some form of work visa). Neither ICE nor the courts will be impressed with the argument that you don't call yourself an employee. They don't care. You're performing work in the United States. Nothing else is relevant.
This is interesting. By that argument, everyone visiting open source conference "sprints" should be deported?
For that matter, if I travel, and happen to do work while in another country that would also be in violation of immigration laws?
I guess at least visiting heads of state get a diplomatic waver...
(Yes, I'm being snarky, but I'm also serious -- I wonder what the the technicalities actually are -- never mind that you'll probably only be deported if you're doing blue collar work...)
> By that argument, everyone visiting open source conference "sprints" should be deported?
By which argument? What job are they doing? Who's paying them? If they're making money off it, then yes, they probably should be deported. If they're doing work someone else could be making money off of, they should also probably be deported.
> For that matter, if I travel, and happen to do work while in another country that would also be in violation of immigration laws?
You would have to consult the laws of the other country in question. I'm sure the only way you could even possibly hope to make this argument in the US is if the company has no US suppliers, customers, or other US-related interests whatsoever. But even that is extremely doubtful.
The general rule for immigration is this: If it's not authorized, it's unauthorized. Unless you have clearly and unambiguously established that it's authorized, don't do it.
> I guess at least visiting heads of state get a diplomatic waver...
Hardly. In the US, they'll need an A visa, just like every other visiting official.
> For that matter, if I travel, and happen to do work while in another country that would also be in violation of immigration laws?
Usually yes. The clincher that it's basically unenforceable and undetectable is why it practically possible in the first place. I'm pretty sure enforcement starts happening when: you stay there longer than a typical tourist visa, money starts landing in their countries bank accounts. You'll still have to file income tax returns somewhere too.
>By that argument, everyone visiting open source conference "sprints" should be deported?
Usually that is covered by the B-1 visa they are entering. The B-1 visa is very expansive. The concept behind many US immigration laws is basically "Are you doing work a US person could do and getting money from a US source, be it corporation, person, etc? If your not, then we are far more OK with that than the opposite." If it's a conference hackathon where nobody usually gets paid anyway, then it should be ok.
Hm. But the article/discussion relates to forming a company (that charges for services) and doing the work "for free". So it would seem either that is legal, or open source work is also illegal?
Also note that uncompensated amateur performances are ok, but paid ones are not. So presumably if you are doing symbolic work without pay (say, the first shovel of a groundbreaking) the fact that they could be paying someone doesn't make it employment.
This leads to all kinds of interesting questions.
If you are an artist and here on a business visa, are you allowed to paint on your own canvas? Are you allowed to buy or sell paintings that you paint here in the US? I would think so. You might not be able to paint a mural for hire though.
> Artists: An artist coming to the United States to paint, sculpt, etc. who is not under contract with a U.S. employer and who does not intend to regularly sell such art-work in the United States.
2. It isn't clear that the LLC is violating any laws for having corporate officers who run afoul with immigration laws.
3. It isn't clear that the corporate officer is subjected to any additional penalties for such work.
If you aren't going to spend an additional day in jail or have additional legal sanctions for certain behavior, then the argument is entirely academic.
In short, yes they can throw them out of the country. My question is.... What other penalties come up for doing the work? If there are none, then it doesn't matter, the only real crime is overstaying the visa, entering illegally, or the like.
And yes immigration can make their lives worse if they want to return. But immigration can do this even if no laws have been broken.
So my question: What, if any, additional penalties attach to an illegal immigrant for the actions of serving as a corporate officer?
> 2. It isn't clear that the LLC is violating any laws for having corporate officers who run afoul with immigration laws.
Corporate officers are just as much employees as anyone else. Where is this idea that they're something else coming from?
By the way, 8 USC 1325(d):
"Any individual who knowingly establishes a commercial enterprise for the purpose of evading any provision of the immigration laws shall be imprisoned for not more than 5 years, fined in accordance with title 18, or both."
regarding 8 USC 1325(d), the plain language seems to suggest that merely starting a business in order to earn money is not what is barred by the law, but rather trying to fraudulantly start a business so as to engage in fraud regarding entrepreneurship visas.
This would seem to parallel 8 USC 1325 (c) which is clearly intended to target straw marriages existing solely for immigration reasons.
Note that neither of these provisions only targets the immigrant party. Both appear to target US citizens as well (for example, agreeing to a sham marriage or a sham business deal aimed at an immigrant visa).
Yes, this headline got me very excited, thinking I had missed a visa category. From what I've gathered, there are very few work visas for non-employees.
At least they can create their own companies in the US. I am currently a freelance frontend engineer who needs to scale to hire people but I can't start my own company in France. I have to do it with a French associate who must be the president. I have the chance of doing it with my best friend.
By the way, they refused to renew my papers because I dropped out of school to be the CTO in a startup who made it to a notorious national journal.
Really, regarding France, just start an Ltd in the UK and hire people in France (evil grin).
I am a part owner of a UK LTD (http://www.efficito.com) and neither our stockholders nor our directors, nor our officers are from the UK. It made it slightly harder to get a bank account opened in the Netherlands though.
I don't know of any in France. My understanding in all cases is that it really helps to know folks at the bank. So I would start at where you currently do your banking and see what you can do there.
I won't say we have a lot of experience and I feel a bit odd making a recommendation based on being in business for less than a year.... (I am in Indonesia and this makes it a bit harder to feel secure in my recommendations.) Feel free to email me at chris@efficito.com and I will talk with my business partner (who is in the Netherlands) a bit more before giving a recommendation.
I used to recommend rabobank, but as of late I've shifted to ABN/Amro. The story behind why I'd drop a 19 year banking relationship is longer than there is room for in this comment box here but it wasn't a triviality. I'll report on ABN/Amro in another 20 years or so :)
Can't you like, form a company in another EU member state with more flexible rules (UK comes to mind) and then operate/provide services in France, which you are allowed to do so due to EU freedom of movement of capital, goods, service and people?
(a) Parents will immigrate with their kids knowing that they won't have legal residence status. I know some immigrants are escaping dire poverty or persecution, but not all. So I think parents have some responsibility here.
(b) Plus, the US is relatively lax in enforcing immigration laws. People do (a) and get work, send their kids to school, buy a house, etc. There's no way you could get away with that in (say) Japan.
similar things for some Britons, mostly of Jamaican origin. If they arrived as children after some date in the 80s, they're in the country "legally", but they're not citizens. They're not allowed to get a passport, and if they leave the country there's no guarantee they'll be allowed back in.
Often, they don't realise this until they're ~20, whenever they first apply for a passport - and they have to go through a lengthy process of applying for citizenship, which can take up to 5 years (or longer, what was that backlog?) and still might not be successful. Which can kind of mess up your holiday plans.
> At 20, should they have a legal right to be there?
Absolutely. After all, if 13 years is not enough to locate and deport them those people have a right to a continued existence in the place where they are now completely at home and integrated. Anything else would be inhuman.
So deporting them (including being real hard on them) before those 13 years is OK, but suddenly 13 years (or 12 or 10) is some kind of limit after which they can impose themselves upon a sovereign country?
Especially since the fail to deport is not because of lack of want or try, but because of evading checks etc?
I'm all for granting asylum for legitimate cases in small numbers, but "came here because my country sucks" or multi-million people migration is not good if the local population doesn't want it.
Actually, with regard to results, it's not extremely different to an invansion and can even help to prepare one later on (such tactics of getting people to mass migrate to another country/region, have been historically used to disrupt population dynamics there and let a third party to have leverage on the original local populations, e.g by China in Tibet and numerous others, even back to the Roman empire).
Some of those things might not apply when talking about small percentages of immigrants or the US (who as a great power has little to fear seriously), but are legitimate concerns for smaller nations.
I personally would put that limit a lot lower, more like 2 years or however long it could reasonably take to process an asylum request if you subscribe to this concept at all (which I really don't, I'm all for completely open borders or disbanding them altogether, it's the only way citizens of various countries get to vote with their feet).
>it's the only way citizens of various countries get to vote with their feet
You're not supposed to "vote with your feet". That's called "fleeing" and those who do it are "cowards". You're supposed to fight and make your country better, including bringing down an oppresive regime etc. For ages, even women and children have fought for freedom and for making the world a better place, including risking their lives. Rosa Parks, for but one example, didn't "vote with their feet".
As for "completely open borders" that either happens when all the earth is a united country (where everybody can vote for the general leadership), or is just crazy talk when there are sovereign countries that are more and less powerful.
If you call someone fleeing an oppressive regime a coward then you're more than likely not currently living in one and have even more likely never lived under one. Let me give you a history lesson, on the off chance that you'll prove me wrong. When you live under an oppressive regime the sum of the power stacked against the few that would do something about it is such that they have three choices: rise up and be cut down, shut up and comply or flee. If you feel like judging any of those that either comply or flee as being either cowards or worse then you forget that ordinary people typically just want to get on with their lives without interference from the authorities. Not everybody is in a position to risk all for an improved status quo, for instance. Those that do are to be commended, those that don't are not to be despised. That's all that I can impart to you from my (short) time of voluntary stay behind what was then called the Iron Curtain, but it is a lesson that stayed with me.
As for the crazy talk, I can definitely imagine a world where there are no border controls but where countries are still sovereign to greater or lesser extent. There are vast regions in the world where we have exactly that situation right now, I don't see why it couldn't apply to the rest of it. The current leader of North Korea might agree with you that this is crazy talk, but then again, that's exactly my opinion of him.
I know people who worked legally(!) in the US for 14 years, and paid taxes for this whole time - they do not even have a Green Card yet. And you are saying that illegal immigrants should get citizenship just because they have been here for 13 years.
No, I think they should be given citizenship because they exhibit all the properties of citizens. The timespan doesn't have anything to do with it just that after such a long time any idea of deportation for whatever reason is totally ridiculous. Reality should never have to adapt to the paper world, but the paper world should adapt to reality.
If you say that once someone exhibit all properties of a citizen he should become one. My question to you is: at what point does one start exhibiting all properties of a citizen and how should Government verify that he does?
If a person is raised since age seven in a house his parents bought with money that they embezzled, and then at age thirty he inherits the house from them, must he give it up once the source of the family's ill-gotten gains is discovered by the authorities?
If I rob your girlfriend of a nice ring she's wearing so that I can give it to my girlfriend, does my girlfriend legally get to keep the ring once the crime becomes known, just because the theft took place years ago?
The amount of time being discussed here is well under thirty years. In any event, property stolen during the Second World War is still being returned forcibly to its original owners.
If you want to engage independent contractor in the US, you need to solicit federal form W-9 which requires the contractor to provide a Taxpayer Identification Number (Employer Identification Number or Social Security Number). If you are engaging a corporation, they usually don't have to provide a W-9.
If you are a contractor trying to register as a company, you need to put a Social Security Number for each owner/officer on the registration forms (in most [all?] of the United States). Persons who aren't authorized to work can get an ITIN (Individual Taxpayer Identification Number) which is a restricted Social Security Number. Restrictions include no ability to collect benefits and expiration after five years.
EDIT: By "register a company" I meant that if you have an ITIN you at least have a number to put in that space on the registration form. Whether or not the jurisdiction will accept the number will vary. Whether or not banks in the area will let you open an account will vary by jurisdiction as well.
Neither Texas nor Washington State appear to require SSN/ITIN information when forming a corporation. I've formed corporations in both states and haven't needed to supply my SSN. The form to request an EIN for the corporation also doesn't request the individual preparer's SSN. When I opened bank accounts for these, I was requested to provide my SSN as a "unique identifier" for me but, with some of the banks/credit unions I used, I was told it is optional.
I am a lawful permanent resident (i.e. green card holder). My SSN card doesn't have any endorsement; it appears exactly the same as a US Citizen's card. When I was on a nonimmigrant visa, it did have the endorsement "VALID FOR WORK ONLY WITH DHS AUTHORIZATION" as I needed an Employment Authorization Card to work. (They granted my green card before they approved the EAC though.)
Legal immigrants whose immigration status allows them to work do get an SSN. Legal immigrants without work-authorized status can't get one. Since it's formally considered only a work-related number, rather than a general identity number (even though it's increasingly being used as the latter), there isn't a provision to get an SSN if you aren't employment-eligible.
You can open an LLC in the US being a foreigner. In fact, you don't even have to come to the US to open it. As such, the social security number is optional.
DACA recipients are not under threat of deportation and are eligible for US work permits. Arizona law still prevents Carla Chavarria from getting a driver's license, but not working AFAIK. I have specifically seen it as an argument against the driver's license law that it makes it hard for DACA people to get a job.
In a similar fashion, owning a LLC makes it radically easier to not pay income taxes than being a W-2 employee, but it does not excuse you from paying income taxes.