Immigrant Petition for Alien Worker as a Member of the Professions Holding an Advanced Degree or an Alien of Exceptional Ability Pursuant to Section 203(b )(2) of the Immigration and Nationality Act, 8 U.S.C. § 1153(b)(2)
ON BEHALF OF PETITIONER:
INSTRUCTIONS:
Enclosed please find the decision of the Administrative Appeals Office (AAO) in your case. This is a non-precedent decision. The AAO does not announce new constructions of law nor establish agency policy through non-precedent decisions. If you believe the AAO incorrectly applied current law or policy to your case or if you seek to present new facts for consideration, you may file a motion to reconsider or a motion to reopen, respectively. Any motion must be filed on a Notice of Appeal or Motion (Form I-290B) within 33 days of the date of this decision. Please review the Form I-290B instructions at http://"'"""v.uscis.gov/forms for the latest information on fee, filing location, and other requirements. See also 8 C.P.R.§ 103.5. Do not file a motion directly with the AAO.
Thank you,
·I ( t;_....·· on Rosen��rg
Chief, Administrative Appeals Office www.uscis.gov
DISCUSSION: The preference visa petition was denied by the Director, Nebraska Service Center, and is now before the Administrative Appeals Office (AAO) on appeal. The appeal will be dismissed.
The petitioner is a management consulting firm. It seeks to employ the beneficiary permanently in the United States as a chemical strategist and project manager. As required by statute, the petition is accompanied by an ETA Form 9089, Application for Permanent Employment Certification, approved by the United States Department of Labor (DOL). The director determined that the petitioner had not established that it had the continuing ability to pay the beneficiary the proffered wage beginning on the priority date of the visa petition. The director denied the petition accordingly.
The record shows that the appeal is properly filed, timely and makes a specific allegation of error in law or fact. The procedural history in this case is documented by the record and incorporated into the decision. Further elaboration of the procedural history will be made only as necessary. As set forth in the director's October 2, 2014 denial, the single issue in this case is whether or not the petitioner has the ability to pay the proffered wage as of the priority date and continuing until the beneficiary obtains lawful permanent residence.
Section 203(b )(2) of the Act provides immigrant classification to members of the professions holding advanced degrees or aliens of exceptional ability, whose services are sought by an employer in the United States. See also 8 C.F.R. § 204.5(k)(l).
The regulation at 8 C.F.R. § 204.5(g)(2) states in pertinent part:
Ability of prospective employer to pay wage. Any petition filed by or for an employment-based immigrant which requires an offer of employment must be accompanied by evidence that the prospective United States employer has the ability to pay the proffered wage. The petitioner must demonstrate this ability at the time the priority date is established and continuing until the beneficiary obtains lawful permanent residence. Evidence of this ability shall be either in the form of copies of annual reports, federal tax returns, or audited financial statements.
The petitioner must demonstrate the continuing ability to pay the proffered wage beginning on the priority date, which is the date the ETA Form 9089, Application for Permanent Employment Certification, was accepted for processing by any office within the employment system of the DOL. See 8 C.F.R. § 204.5(d). The petitioner must also demonstrate that, on the priority date, the beneficiary had the qualifications stated on its ETA Form 9089, Application for Permanent Employment Certification, as certified by the DOL and submitted with the instant petition. Matter of Wing's Tea House, 16 I&N Dec. 158 (Acting Reg'l Comm'r 1977).
Here, the ETA Form 9089 was accepted on August 9, 2012. The proffered wage as stated on the ETA Form 9089 is $87,194 per year. The ETA Fortn 9089 states that the position requires a p. 3 NON-PRECEDENTDEC�JON
Master's degree or foreign equivalent degree in Chemistry and 24 months of experience as a chemical strategist, in research and development, product development or related field.
We conduct appellate review on a de novo basis. See Soltane v. DOJ, 381 F.3d 143, 145 (3d Cir. 2004). We consider all pertinent evidence in the record, including new evidence properly submitted upon appeal.1
The evidence in the record of proceeding shows that the petitioner is structured as an S corporation. On the petition, the petitioner claimed to have been established in 2000 and to currently employ 10 workers. According to the tax returns in the record, the petitioner's fiscal year is based on a calendar year. On the ETA Form 9089, signed by the beneficiary on December 5, 2013, the beneficiary claims to have begun working for the petitioner on October 15, 2006.
The petitioner must establish that its job offer to the beneficiary is a realistic one. Because the filing of an ETA 9089 labor certification application establishes a priority date for any immigrant petition later based on the ETA 9089, the petitioner must establish that the job offer was realistic as of the priority date and that the offer remained realistic for each year thereafter, until the beneficiary obtains lawful permanent residence. The petitioner's ability to pay the proffered wage is an essential element in evaluating whether a job offer is realistic. See Matter of Great Wall, 16 I&N Dec. 142 (Acting Reg'l Comm'r 1977); see also 8 C.P.R. § 204.5(g)(2). In evaluating whether a job offer is realistic, United States Citizenship and Immigration Services (USCIS) requires the petitioner to demonstrate financial resources sufficient to pay the beneficiary's proffered wages, although the totality of the circumstances affecting the petitioning business will be considered if the evidence warrants such consideration. See Matter ofSonegawa, 12 I&N Dec. 612 (Reg'l Comrn'r 1967).
In determining the petitioner's ability to pay the proffered wage during a given period, USCIS will first examine whether the petitioner employed and paid the beneficiary during that period. If the petitioner establishes by documentary evidence that it employed the beneficiary at a salary equal to or greater than the proffered wage, the evidence will be considered prima facie proof of the petitioner's ability to pay the proffered wage. In the instant case, the petitioner submitted the following Internal Revenue Service (IRS) Forms W-2:
- The 2012 IRS Form W-2 states that the petitioner paid the beneficiary $45,679.25.2 1 The submission of additional evidence on appeal is allowed by the instructions to the Form I-2908, which are incorporated into the regulations by the regulation at 8 C.F.R. § 103.2(a)(l). The record in the instant case provides no reason to preclude consideration of any of the documents newly submitted on appeal. See Matter of Soriano, 19 l&N Dec. 764 (BIA 1988).
- The 2013 IRS Form W-2 states that the petitioner paid the beneficiary $66,826.25.
The amount paid by the petitioner to the beneficiary in both years is less than the proffered wage. As a result, the petitioner must prove its ability to pay the difference between the actual wage paid and the proffered wage, which in 2012 was $41,514.75 and in 2013 was $20,367.75.
If the petitioner does not establish that it employed and paid the beneficiary an amount at least equal to the proffered wage during that period, USCIS will next examine the net income figure reflected on the petitioner's federal income tax return, without consideration of depreciation or other expenses. River Street Donuts, LLC v. Napolitano, 558 F.3d 111 (1st Cir. 2009); Taco Especial v. Napolitano, 696 F. Supp. 2d 873 (E.D. Mich. 2010), aff'd, No. 10-1517 (6th Cir. filed Nov. 10, 2011). Reliance on federal income tax returns as a basis for determining a petitioner's ability to pay the proffered wage is well established by judicial precedent. Elatos Restaurant Corp. v. Sava, 632 F.Supp. 1049, 1054 (S.D.N.Y. 1986) (citing Tongatapu Woodcraft Hawaii, Ltd. v. Feldman, 736 F.2d 1305 (9th Cir. 1984)); see also Chi-Feng Chang v. Thornburgh, 719 F. Supp. 532 (N.D. Texas 1989); K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. 1080 (S.D.N.Y. 1985); Ubeda v. Palmer, 539 F. Supp. 647 (N.D. Ill. 1982), aff'd, 703 F.2d 571 (7th Cir. 1983). Reliance on the petitioner's gross receipts and wage expense is misplaced. Showing that the petitioner's gross receipts exceeded the proffered wage is insufficient. Similarly, showing that the petitioner paid wages in excess of the proffered wage is insufficient.
In K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. at 1084, the court held that the Immigration and Naturalization Service, now USCIS, had properly relied on the petitioner's net income figure, as stated on the petitioner's corporate income tax returns, rather than the petitioner's gross income. The court specifically rejected the argument that USCIS should have considered income before expenses were paid rather than net income. See Taco Especial v. Napolitano, 696 F. Supp. 2d at 881 (gross profits overstate an employer's ability to pay because it ignores other necessary expenses). With respect to depreciation, the court in River Street Donuts noted:
The AAO recognized that a depreciation deduction is a systematic allocation of the cost of a tangible long-term asset and does not represent a specific cash expenditure during the year claimed. Furthermore, the AAO indicated that the allocation of the depreciation of a long-term asset could be spread out over the years or concentrated into a few depending on the petitioner's choice of accounting and depreciation methods. Nonetheless, the AAO explained that depreciation represents an actual cost of doing business, which could represent either the diminution in value of buildings and equipment or the accumulation of funds necessary to replace perishable equipment and buildings. Accordingly, the AAO stressed that even though amounts deducted for depreciation do not In the instant petition, in evaluating the petitioner's ability to pay the proffered wage, the beneficiary's gross pay amounts will be used, rather than the somewhat lower amounts of taxable compensation shown on the IRS Forms W -2 for the relevant years.
NON-PRECEDENT DEC�ION represent current use of cash, neither does it represent amounts available to pay wages.
We find that the AAO has a rational explanation for its policy of not adding depreciation back to net income. Namely, that the amount spent on a long term tangible asset is a "real" expense.
River Street Donuts, 558 F.3d at 118. "(USCIS] and judicial precedent support the use of tax returns and the net income figures in determining petitioner's ability to pay. Plaintiffs' argument that these figures should be revised by the court by adding back depreciation is without support." Chi-Feng Chang, 71 9 F. Supp. at 537 (emphasis added).
The record before the director closed on August 4, 2014 with the receipt by the director of the petitioner's submissions in response to the director's request for evidence. As of that date, the petitioner's 20 13 federal income tax return was not yet due pursuant to an extension requested until September 15, 2014. Therefore, the petitioner's income tax return for 2012 is the most recent return available. The petitioner's Form 1120S states its net income3 for 2012 as $33,882, which is less than the difference between the actual wage paid and the proffered wage. Therefore, the petitioner did not have sufficient net income to pay the difference between the actual wage paid and the proffered wage in 2012.
On appeal the petitioner sumbits a letter from CPA, stating, "We have prepared the S-Corporation tax returns for [the petitioner] for the tax year 2013." However, the petitioner failed to submit a copy of its 2013 tax return. Going on record without supporting documentary evidence is not sufficient for purposes of meeting the burden of proof in these proceedings.Claims not backed by documents Matter of Soffici, 22 I&N Dec. 158, 165 (Comm'r 1998) (citing Matter of Treasure Craft of California, 14 I&N Dec. 190 (Reg'l Comm'r 1972)). Therefore, the petitioner has failed to submit evidence of its net income for '20 13.
As an alternate means of determining the petitioner's ability to pay the proffered wage, USCIS may review the petitioner's net current assets. Net current assets are the difference between the petitioner's current assets and current liabilities.4 A corporation's year-end current assets are shown 3 Where an S corporation's income is exclusively from a trade or business, USCIS considers net income to be the figure for ordinary income, shown on line 21 of page one of the petitioner's IRS Form 1120S. However, where an S corporation has income, credits, deductions or other adjustments from sources other than a trade or business, they are reported on Schedule K. If the Schedule K has relevant entries for additional income, credits, deductions or other adjustments, net income is found on line 18 of Schedule K. See Instructions for Form 1120S, at http://www.irs.gov/pub/irs-pdf/il l 20s.pdf (accessed December 9, 2014) (indicating that Schedule K is a summary schedule of all shareholders' shares of the corporation's income, deductions, credits, etc.). Because the petitioner had additional adjustments shown on its Schedule K for 2012, the petitioner's net income is found on Schedule K of its tax return.
on Schedule L, lines 1 through 6. Its year-end current liabilities are shown on lines 16 through 18. If the total of a corporation's end-of-year net current assets and the wages paid to the beneficiary (if any) are equal to or greater than the proffered wage, the petitioner is expected to be able to pay the proffered wage using those net current assets. The petitioner's Form 1120S states its end-of-year net current assets for 2012 as -$281,448. Therefore, the petitioner did not have sufficient net current assets to pay the difference between the actual wage paid and the proffered wage in 2012. As noted above, the petitioner failed to submit evidence of its 2013 net current assets.
Therefore, from the date the ETA Form 9089 was accepted for processing by the DOL, the petitioner had not established that it had the continuing ability to pay the beneficiary the proffered wage as of the priority date through an examination of wages paid to the beneficiary, or its net income or net current assets.
On appeal, counsel asserts that an account receivable was not included on the 2012 tax return and that the salary and expenses of the petitioner's owner, such as payroll, benefits, travel, and entertainment, is available to cover the proffered wage. Counsel additionally notes that the 20 13 tax return is not yet available but that the accountant who prepared the tax return submitted a statement concerning the petitioner's assets.
The petitioner submitted a letter dated October 29, 2004 authored by the petitioner's Operations Manager, stating that the petitioner has an accounts receivable in 2012 in the amount of $22,208. Going on record without supporting documentary evidence is not sufficient for purposes of meeting the burden of proof in these proceedings. Matter ofSoffici, 22 I&N Dec. 158, 165 (Comm'r 1998) (citing Matter ofTreasure Craft of California, 14 I&N Dec. 190 (Reg'l Comm'r 1972)). This amount was reflected upon the petitioner's Form 1120S as an asset of the corporation. The petitioner submitted no explanation as to why this amount was not reported on its 20 12 tax return and amended tax returns were not provided.
The sole shareholder of a corporation has the authority to allocate expenses of the corporation for various legitimate business purposes, including for the purpose of reducing the corporation's taxable income.5 Compensation of officers is an expense category explicitly stated on the Form 1120S U.S. Corporation Income Tax Return.
NON-PRECEDENTDEC�ION
The documentation presented here indicates that holds 90 percent of the company's stock, holds 5 percent of the company's stock, and holds 5 percent of the company's stock. The October 29, 2014 letter from Ms. states that "the owner of the company" was paid $91,500 in salary; received $24,000 in medical and dental benefits; and received $25,000 in travel, meal, and entertainment benefits. According to the petitioner's 2012 IRS Form 1120S, the petitioner paid $91,500 in officer compensation and took a deduction of $12,668 for 50% of meals and entertainment. On IRS Form 1120S, the instructions require the taxpayer to enter deductible officers' compensation on line 12. On line 13, the instructions require the taxpayer to enter total salaries and wages paid for the tax year. The instructions to line 13 specifically state: "Do not include salaries and wages deductible elsewhere on the return, such as amounts included in officer's compensation ... " http://www.irs.gov/pub/irs-pdf/i1120s.pdf (accessed December 10, 2014). "It is incumbent on the petitioner to resolve any inconsistencies in the record by independent objective evidence, and attempts to explain or reconcile such inconsistencies, absent competent objective evidence pointing to where the truth, in fact, lies, will not suffice."Inconsistencies in the record Matter of Ho, 19 I&N Dec. 582, 591-592 (BIA 1988). The evidence in the record conflicts as to whether a salary or officer compensation was provided and to whom. As a result, it is unclear whether this amount would be available to pay the difference between the actual wage paid and the proffered wage.
In addition, Schedule K-1 of the Form 1120S indicates that the majority "owner" is a corporation and not an individual. A corporation would be beholden to its shareholders and would not be able to volunteer to go without any compensation due without a statement by its officers or shareholders. No such statement or evidence was submitted. Even assuming that the majority shareholder ,corporation is an individual "owner" as represented by counsel, that person submitted no evidence to demonstrate that he was willing and able to forego compensation to meet the wage obligations to the beneficiary. The assertions of counsel do not constitute evidence. Matter of Obaigbena, 19 I&N Dec. 533, 534 (BIA 1988); Matter of Ramirez-Sanchez, 17 I&N Dec. 503, 506 (BIA 1980). As a result, we may not consider this amount as available to pay the difference between the actual wage paid and the proffered wage.
The October 30, 2014 letter from Certified Public Accountant, states that although the petitioner's 2013 tax return is not available, they reflect "total assets" of $142,131. As stated above, the petitioner's net current assets, amounting to current assets having a life of one year or less offset by current liabilities of obligations payable within one year, is a more accurate reflection of the petitioner's ability to pay the difference between the actual wage paid and the proffered wage than the total assets reflected on the petitioner's Schedule L. In addition, any financial statements or accountant's report must be audited to provide evidence under the regulation at 8 C.F.R. § 204.5(g)(2); no such audited statement was provided. Consequently, the accountant's letter is not sufficient to establish the petitioner's ability to pay the difference between the actual wage paid and the proffered wage.
Counsel's assertions on appeal cannot be concluded to outweigh the evidence presented in the tax returns as submitted by the petitioner that demonstrates that the petitioner could not pay the proffered wage from the day the ETA Form 9089 was accepted for processing by the DOL.
USCIS may consider the overall magnitude of the petitioner's business activities in its determination of the petitioner's ability to pay the proffered wage. See Matter of Sonegawa, 12 I&N Dec. 612 (Reg'l Comm'r 1967). The petitioning entity in Sonegawa had been in business for over 11 years and routinely earned a gross annual income of about $100,000. During the year in which the petition was filed in that case, the petitioner changed business locations and paid rent on both the old and new locations for five months. There were large moving costs and also a period of time when the petitioner was unable to do regular business. The Regional Commissioner determined that the petitioner's prospects for a resumption of successful business operations were well established. The petitioner was a fashion designer whose work had been featured in Time and Look magazines. Her clients included Miss Universe, movie actresses, and society matrons. The petitioner's clients had been included in the lists of the best-dressed California women. The petitioner lectured on fashion design at design and fashion shows throughout the United States and at colleges and universities in California. The Regional Commissioner's determination in Sonegawa was based in part on the petitioner's sound business reputation and outstanding reputation as a couturiere. As in Sonegawa, USCIS may, at its discretion, consider evidence relevant to the petitioner's financial ability that falls outside of a petitioner's net income and net current assets. USCIS may consider such factors as the number of years the petitioner has been doing business, the established historical growth of the petitioner's business, the overall number of employees, the occurrence of any uncharacteristic business expenditures or losses, the petitioner's reputation within its industry, whether the beneficiary is replacing a former employee or an outsourced service, or any other evidence that USCIS deems relevant to the petitioner's ability to pay the proffered wage.
In the instant case, the petitioner submitted only one year's tax return, so that we are unable to determine whether the information found on that tax return for 2012 is indicative of the petitioner's overall financial situation or whether 2012 was an anomalous year. The petitioner submitted evidence that the beneficiary is respected in his field and that he has achieved some accolades, however, the beneficiary's reputation is insufficient to establish that the petitioner has a reputation within the field for excellence so as to provide evidence of the petitioner's ability to pay the proffered wage to the beneficiary. Counsel on appeal stated that the "owner" of the company would be willing to forego part of his salary to meet the wage obligations to the beneficiary, but the evidence in the record does not establish that the petitioner has one owner who would be willing and able to forego all or part of that compensation or any benefits. Thus, assessing the totality of the circumstances in this individual case, it is concluded that the petitioner has not established that it had the continuing ability to pay the proffered wage.
The evidence submitted does not establish that the petitioner had the continuing ability to pay the proffered wage beginning on the priority date.
Beyond the decision of the director, the petitioner has also not established that the beneficiary is qualified for the offered position. An application or petition that fails to comply with the technical requirements of the law may be denied by the AAO even if the Service Center does not identify all of the grounds for denial in the initial decision. See Spencer Enterfrises, Inc. v. United States, 229 F. Supp. 2d 1025, 1043 (E.D. Cal. 2001), affd, 345 F.3d 683 (9t Cir. 2003); see also Soltane v. p. 9 DOJ, 381 F.3d 143, 145 (3d Cir. 2004) (noting that the AAO conducts appellate review on a de novo basis).
The petitioner must establish that the beneficiary possessed all the education, training, and experience specified on the labor certification as of the priority date. 8 C.F .R. § 103 .2(b )(1), (12). See Matter of Wing's Tea House, 16 I&N Dec. 158, 159 (Acting Reg'l Comm'r 1977); see also Matter of Katigbak, 14 I&N Dec. 45, 49 (Reg'l Comm'r 1971). In evaluating the beneficiary's qualifications, USCIS must look to the job offer portion of the labor certification to determine the required qualifications for the position. US CIS may not ignore a "term of the labor certification, nor may it impose additional requirements. See Madany v. Smith, 696 F.2d 1008 (D.C. Cir. 1983); K.R.K. Irvine, Inc. v. Landon, 699 F.2d 1006 (9th Cir. 1983); Stewart Irifra-Red Commissary of Massachusetts, Inc. v. Coomey, 661 F.2d 1 (1st Cir. 1981).
In the instant case, the labor certification states that the offered position requires a Master's degree in Chemistry. On the labor certification, the beneficiary claims to qualify for the offered position based on a Master's degree from the Netherlands, completed in 1987. The record contains a statement from Studv Counselor Chemistry with stating that the beneficiary earned a in 1983 and in 1987, both in Chemistry. The record also contains statements in Latin and Dutch that the beneficiary is qualified for two degrees in the Mathematics and Natural Sciences department, in 1983 and 1987 respectively. The record does not contain official transcripts for the beneficiary's degree. As a result, we are unable to conclude that he holds the foreign equivalent of a U.S. Master's degree in Chemistry. With any further filings, the petitioner must submit official transcripts from the with certified translations.
In visa petition proceedings, it is the petitioner's burden to establish eligibility for the immigration benefit sought. Section 291 of the Act, 8 U.S.C. § 1361; Matter of Otiende, 26 I&N Dec. 127, 128 (BIA 2013). The petitioner has not met that burden.
ORDER: The appeal is dismissed.