Can I start my own business in the U.S. on the side?

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Can I start my own business in the U.S. on the side?

By Jim Nolan | June 8, 2010

We receive questions from people who have different types of work visas with corporate sponsors like H-1B, L-1A, about whether they can start their own business and, at the same time, keep working for their visa sponsor.

Anyone is free to register a business in the U.S. He or she should get a separate tax ID number for the business which can do by clicking here. They should also probably talk to an accountant to decide which is the best business form for their business, such as incorporation, partnership, limited liability corporation, etc. For immigration purposes all business forms are fine, but there are certain tax and liability issues which may affect what type of business they want to create.

As an owner they can receive a dividend from or withdraw owner’s equity from their business without a new visa. They can hire others to work for their business to make a profit which they can then take out of the business.

However, they are not free to work at their own business without a new visa.

One possible visa would be an H-1B visa. I have written a blog on the risks of people sponsoring themselves for an H-1B visa so please click here to review my comments. If they already have a full-time H-1B visa from another company this would be tricky. The owner would have to say that he or she would work at his or her business on a part-time basis, something like 10 to 20 hours per week. There is no minimum number of hours for an H-1B visa holder.

The owner has to qualify for an H-1B visa and the main requirement is that their major in school must be related to their job it . For example, someone with an H-1B in the financial industry with a major in finance may have trouble getting an H-1B visa as a graphic designer.

Another possibility would be an E-2 (investor), but not everyone can get this type of visa. The owner’s home country would need a treaty with the U.S. permitting an investor visa. You can see if your country qualifies by clicking here, select your country from the drop down box at the top and go down the page to E-2 visa line. If it says “no treaty” you can’t get an E-2 visa.

If the owner can get an E-2 visa you would need to make a “substantial” investment in your business. While there is no legal definition of “substantial” my experience is that Immigration considers $75,000 a minimum investment. You would also need an office lease and a business plan among other things. E-2 visas are tricky and the potential owner should consult an experience attorney about whether he or she has a reasonable chance of qualifying for one.

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