unitednations said:
Jim, I can't find one of your other posts regarding depreciation. I thought somewhere you may have said that depreciation can be added back to taxable income for ability to pay issus.
I'm not sure if I mis-interpreted.
Could you clarify. Reason I ask is that I examined some administrative decisions and it seems that company cannot make adjustments for "depreciation" unless they amend the tax return and not deduct "depreciation".
Any thoughts.
If you are talking about the case of Ranchito Coletero, 2002-INA-105 (BALCA, January 10, 2003), There are two issues. First, it is a BALCA case and is not binding on the USCIS but ore importantly, the case was to some extent reversed in an en banc appeal. In the first case, the Certifying Officer requested evidence of full time employment. The employer, a sole proprietor, had an annual loss in business income which was caused by depreciation of capital investments. The Employer also had a personal annual income (adjusted gross income) of $85,000.00. The Board initially held that the farm is a separate entity from the Employer and that only the income shown on Schedule C could be used to document the ability to pay the wages.
This decision was appealed to BALCA en banc and a decision was issued on 1/8/04. In reviewing the prior decision, Board held en banc that as in O'Conner v. Attorney General of the United States, 1987 WL 18243 (D. Mass. Sept. 29, 1987) (unpublished) the entire financial circumstances of a sole proprietorship employer should be considered when considering the ability to pay the wages relating to permanent alien labor certification. The Board also relied on a previous BALCA decision, Ohsawa America, 1988-INA-240 (Aug. 30, 1988), in which, although the corporate employer, as of the date of application for labor certification, had been showing prior losses and a negative working capital, the panel found sufficiency of funds where the company's accountant showed that the employer had increased sales and reduced operating losses, and that the major shareholder, who had indicated a willingness to continue to fund the company, had a person net worth of over $4,000,000.
The INS normally has the responsibility to examine this issue, and it is normaly not reviewed till the I-140 stage, but courts have uphold the DOL's right to inquire into this area based on the Employer's certification that he has the wages available to pay the alien. If you are aware of other cases that are applicable to this please let me know since I have not recently done a thorough review of this issue. Based on the above, I would still argue that depreciation should be added back in to prove ability to pay. If USCIS wants to fight about it, so be it.
