flipping real estate on H1B

[realdesi16]

Guys,
I need desperate help on this. I am on H1B currently and I have I-140 approved (EB3 - cannot file 485 because of retrogression but that is another matter). I own one rental property. Also I have flipped couple of houses and made profit. Do you guys think this is aganist the law ? Is this going to adversely affect my green card application ? My attorney told me that I need to form some kind of corporation . Is he right ? I have heard that when they call for the green card interview, they ask for tax returns. what are the chances that somebody is called for the interview ? I am with the same company from the beginning that filed my green card. I did not have any other jobs.

Any help will be really appreciated. I am ready to stop this if its going to affect my green card in any way. By the way this was just an honest mistake. I thought that real estate investments were just like stocks.

thanks

[businesswoman]

From what I have understood from your posting, you own real estate that you rent- right. If that's the case, you don't have to worry you will report it as rental income and it has nothing to do with green card.

Secondly, I am not sure sure why your attorney has suggested you to inccorporate and move the property in to that, because when you move assets into your corporation it means you recognize gain on your personal side, which you certainly don't want. Also, one of the main reasons you want to incorporate is protect your personal assets. Placing your assets in the Corporation is certainly not a good idea.

Limited Liability company is certainly a good idea, but again it depends on the State you are located in.

I hope this info helps you.

[realdesi16]

Thanks **** and businesswoman for your replies.
I am going to stop the flipping. By the way according to **** there is less likelihood that somebody on employment-based green card is called for interview, so its possible that I may get away with this. right ?
If they ask for tax returns, is it at the time of filing 485 or during the processing of 485 or at the interview time ?
If they ask for tax returns during the interview what should be my explanation ?
Thanks for all the replies.

[businesswoman]

I don't think buying and selling properties is a issue with GC. All you are doing is selling investment property.
Could you explain what are you worried abt?

[realdesi16]

So Joe what you are saying is that after I get my EAD, flipping is legal? But then I would be also on H1B at that point so then that makes it not legal.
By the way according to my lawyer day-trading on stocks is not business and so is OK. I dont understand all this at all. Is not real estate also a passive investment ? Can somebody point me to the exact wording of the immigration rules that differentiates between stock investments and real estate investments and that real estate investment is considered as business.

[realdesi16]

So Joe what you are saying is that after I get my EAD, flipping is legal? But then I would be also on H1B at that point so then that makes it not legal.

By the way according to my lawyer day-trading on stocks is not business and so is OK. Also he told me that besides flipping even having rental real estate is considered as business.
I dont understand all this at all. Is not real estate also a passive investment ? Can somebody point me to the exact wording of the immigration rules that differentiates between stock investments and real estate investments and that real estate investment is considered as business.

[megaptera]

****,

Do you know of a good online resource where I can look through the CIS memos? Or does it exist only in printed form? Any relevant info is appreciated.

[realdesi16]

Joe and businesswoman I need your help in figuring out this. Since I cannot do real estate flipping on H1, my real estate agent suggested me to become a shareholder of either a C or S real estate corporation. The other members of this corporation would be US citizens or PR and one of them would be the managing director who would do the day-to-day management for the firm. He told me that the income that would be generated by flipping real estate as a part of this corporation would be shown as dividends on my personal tax returns. Is he right ? Am I really safe doing this ?

I read somewhere that an H1B visa holder cannot be a shareholder of a S-corporation but can be for C-corporation. Is that right ? If yes, investing as a part of this C-corporation by becoming a shareholder entitles me to show the dividend income as passive income on the tax return. Is this right ? Please help me out. This is very important. Also tell me how confident you are of the authenticity of your opinion on this.

[indyanguy]

Unrelated question.

Joe, you said:

"They have bigger fish to fry. But, if you happen to get on their radar for something else, they may look into everything. That has happened, for example with failure to file an address change form (AR-11). In particular after 9/11, they got much stricter."

On what visa status do we have to file the address change form? Is it only on F1?

Sorry for hijackin the thread

[sae2008]

I am wondering if any one has a definitive answer on whether it is legal to "flip" real estate on a H1B visa?

By "Flip" I mean, putting a house under contract from the seller, then finding another buyer for it and doing a back to back closing. what that means is that the property will only be held by me technically for a few hours or days.

The above thread does not seem to have an answer around this?

Also, if I do some marketing to generate investment leads, is that legal also?

thanks!

[TheRealCanadian]

Originally Posted by sae2008

I am wondering if any one has a definitive answer on whether it is legal to "flip" real estate on a H1B visa?

If you do it regularly, no.

By "Flip" I mean, putting a house under contract from the seller, then finding another buyer for it and doing a back to back closing. what that means is that the property will only be held by me technically for a few hours or days.

Good luck doing that in this real estate market.