business on h1b
#1
Banned
Thread Starter
Joined: Apr 2010
Posts: 23
business on h1b
I am trying to figure out how to start and participate in a business on h1b visa and stay safe from IRS/INS.
I know, I can be a passive investor and will own 50% of LLC, so my friend will be handling day-to-day activities, sign all documents, handle things related to sales and all client facing activities. From my side I will be responsible for manufacturing the product.
If we become profitable I will need to declare my profit somehow... I am a bit scared to do this as dividends because it might be a red flag for IRS or INS during my CG processing. So what I can do is to register a company in Canada (I have a Canadian PR status) and sell manufactured products to my friend’s US company at the price to cover my contribution to the American company (where I am listed as a passive investor). While my friends will be handling distribution in the US. This money will go to my Canadian bank account and I will pay taxes in Canada.
Does this scheme work?
Thank you
I know, I can be a passive investor and will own 50% of LLC, so my friend will be handling day-to-day activities, sign all documents, handle things related to sales and all client facing activities. From my side I will be responsible for manufacturing the product.
If we become profitable I will need to declare my profit somehow... I am a bit scared to do this as dividends because it might be a red flag for IRS or INS during my CG processing. So what I can do is to register a company in Canada (I have a Canadian PR status) and sell manufactured products to my friend’s US company at the price to cover my contribution to the American company (where I am listed as a passive investor). While my friends will be handling distribution in the US. This money will go to my Canadian bank account and I will pay taxes in Canada.
Does this scheme work?
Thank you
Last edited by MichaelX; Feb 20th 2013 at 8:56 pm.
#2
Re: business on h1b
If we become profitable I will need to declare my profit somehow... I am a bit scared to do this as dividends because it might be a red flag for IRS or INS during my CG processing.
So what I can do is to register a company in Canada (I have a Canadian PR status) and sell manufactured products to my friend’s US company at the price to cover my contribution to the American company (where I am listed as a passive investor). While my friends will be handling distribution in the US. This money will go to my Canadian bank account and I will pay taxes in Canada.
Rene
#3
Re: business on h1b
I am trying to figure out how to start and participate in a business on h1b visa and stay safe from IRS/INS.
I know, I can be a passive investor and will own 50% of LLC, so my friend will be handling day-to-day activities, sign all documents, handle things related to sales and all client facing activities. From my side I will be responsible for manufacturing the product.
If we become profitable I will need to declare my profit somehow... I am a bit scared to do this as dividends because it might be a red flag for IRS or INS during my CG processing. So what I can do is to register a company in Canada (I have a Canadian PR status) and sell manufactured products to my friend’s US company at the price to cover my contribution to the American company (where I am listed as a passive investor). While my friends will be handling distribution in the US. This money will go to my Canadian bank account and I will pay taxes in Canada.
Does this scheme work?
Thank you
I know, I can be a passive investor and will own 50% of LLC, so my friend will be handling day-to-day activities, sign all documents, handle things related to sales and all client facing activities. From my side I will be responsible for manufacturing the product.
If we become profitable I will need to declare my profit somehow... I am a bit scared to do this as dividends because it might be a red flag for IRS or INS during my CG processing. So what I can do is to register a company in Canada (I have a Canadian PR status) and sell manufactured products to my friend’s US company at the price to cover my contribution to the American company (where I am listed as a passive investor). While my friends will be handling distribution in the US. This money will go to my Canadian bank account and I will pay taxes in Canada.
Does this scheme work?
Thank you
#4
Re: business on h1b
Your question seems similar (if not the same) as one you posted in January 2012:
http://britishexpats.com/forum/showthread.php?t=744747
Rene
http://britishexpats.com/forum/showthread.php?t=744747
Rene
#5
Re: business on h1b
Doesn't he mean that he is currently on an H1-B and is worried about being involved in a side project for another company?
#6
Re: business on h1b
If you're getting the Greencard and have got to the point where you have the EAD, you're all set.
If you're not, then you can't work for this side venture.
If you're not, then you can't work for this side venture.
#7
Re: business on h1b
Rene
#8
Re: business on h1b
Doesn't the EAD render the H1-B moot? I'm pretty sure I was told by my lawyer that the H1-B is no longer valid once you have the EAD.
#10
Account Closed
Joined: Aug 2002
Location: Kentucky
Posts: 38,865
Re: business on h1b
No, you won't... not if you're doing the manufacturing in the US. If you're on an H-1B and you're in the US, you can work only for the H-1B sponsor. If the business is in Canada and you're in Canada when you do the manufacturing, that's not a problem... but once you cross the US border you can't do any manufacturing. If you're in the US you can be a passive investor, but you can't work for your company, and you can't work for yourself.
BTW, the INS ceased to exist over 10 years ago! As for the IRS, as long as your H-1B income is coming from your H-1B sponsor, and your manufacturing income is being earned while you are physically in Canada, it won't be an issue.
Ian
BTW, the INS ceased to exist over 10 years ago! As for the IRS, as long as your H-1B income is coming from your H-1B sponsor, and your manufacturing income is being earned while you are physically in Canada, it won't be an issue.
Ian
#11
Re: business on h1b
Doesn't matter, the EAD allows him to work for whoever, so he can use that to work for the current employer and someone else.
#12
Account Closed
Joined: Mar 2004
Posts: 2
Re: business on h1b
Just wondering if you are related to the Michael X in The Bank Job?
Would the manufacturing be done abroad?
Would the manufacturing be done abroad?
#13
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Thread Starter
Joined: Apr 2010
Posts: 23
Re: business on h1b
I am currently in the US on h1 visa and I don't have EAD yet.
I am thinking of manufacturing this product in the US as a side project. The product I am talking about is quite simple so I can order it from a printing house or even do it myself at home.
Also, I KNOW that it violates H1 visa rules... but I am trying to find a way how to minimize the risks. You know, several famous IT companies (e.g. Borland) were founded by tech entrepreneurs who came to the US by tourist visas.
I am thinking of manufacturing this product in the US as a side project. The product I am talking about is quite simple so I can order it from a printing house or even do it myself at home.
Also, I KNOW that it violates H1 visa rules... but I am trying to find a way how to minimize the risks. You know, several famous IT companies (e.g. Borland) were founded by tech entrepreneurs who came to the US by tourist visas.
#14
Re: business on h1b
Also, I KNOW that it violates H1 visa rules... but I am trying to find a way how to minimize the risks.
Rene
#15
Banned
Thread Starter
Joined: Apr 2010
Posts: 23
Re: business on h1b
I already said that I know that it violates H1b visa rules.
I can be travelling between Canada and the US, I can buy materials using my Canadian's company bank account, so how can someone tell for sure where it was manufactured?
I can be travelling between Canada and the US, I can buy materials using my Canadian's company bank account, so how can someone tell for sure where it was manufactured?