dismissed EB-3 Case: Architecture

U.S. Department of Homeland Security 
20 Mass, N. W. Rrn. A3042 
Washington, DC 20529 
U.S. Citizenship 
and Immigration 
Services 
So 
Office: CALIFORNU SERVICE CENTER Date: HAY 1 5 2006 
WAC 03 242 54681 
PETITION: Immigrant petition for Alien Worker as a Skilled Worker or Professional pursuant to 
section 203(b)(3) of the Immigration and Nationality Act, 8 U.S.C. 9 1 153@)(3) 
ON BEHALF OF PETITIONER: 
INSTRUCTIONS: 
This is the decision of the Administrative Appeals Office in your case. All documents have been 
returned to the office that originally decided your case. Any further inquiry must be made to that 
office. 
Robert P. Wiemann, Chief 
Administrative Appeals Office 
Page 2 
DISCUSSION: The preference visa petition was denied by the Director, California Service Center, and is 
now before the Administrative Appeals Office on appeal. The appeal will be dismissed. 
The petitioner is an architecture, design and construction corporation. It seeks to employ the beneficiary 
permanently in the United States as an architectural project manager. As required by statute, the petition is 
accompanied by a Form ETA 750, Application for Alien Employment Certification, approved by the U. S. 
Department of Labor. 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. 
According to the petition, the petitioner was established as a sole proprietorship in 1989, and as a corporation, 
in 1998. It has eight employees. 
Section 203(b)(3)(A)(i) of the Immigration and Nationality Act (the Act), 8 U.S.C. $ 1153(b)(3)(A)(i), 
provides for the granting of preference classification to qualified immigrants who are capable, at the time of 
petitioning for classification under this paragraph, of performing skilled labor (requiring at least two years 
training or experience), not of a temporary nature, for which qualified workers are not available in the United 
States. 
The regulation at 8 C.F.R. 5 204.5(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 in the form of copies of annual 
reports, federal tax returns, or audited financial statements. 
The regulation at 8 CFR 3 204.5(1)(3)(ii) states, in pertinent part: 
(A) General. 
 Any requirements of training or experience for shlled workers, 
professionals, or other workers must be supported by letters from trainers or employers 
giving the name, address, and title of the trainer or employer, and a description of the 
training received or the experience of the alien. 
(B) Skilled workers. 
 If the petition is for a shlled worker, the petition must be 
accompanied by evidence that the alien meets the educational, training or experience, 
and any other requirements of the individual labor certification, meets the requirements 
for Schedule A designation, or meets the requirements for the Labor Market Information 
Pilot Program occupation designation. The minimum requirements for this 
classification are at least two years of training or experience. 
The petitioner must demonstrate the continuing ability to pay the proffered wage beginning on the priority 
date, which is the date the Form ETA 750 Application for Alien Employment Certification, was accepted for 
processing by any office within the employment system of the U.S. Department of Labor. The petitioner must 
also demonstrate that, on the priority date, the beneficiary had the qualifications stated on its Form ETA 750 
Page 3 
Application for Alien Employment Certification as certified by the U.S. Department of Labor and submitted with 
the instant petition. Matter of Wing's Tea House, 16 I&N Dec. 158 (Act. Reg. Comm. 1977). 
Here, the Form ETA 750 was accepted on March 26, 2002. The proffered wage as stated on the Form ETA 
750 is $44,000.00 per year. The Form ETA 750 states that the position requires six years experience. 
On appeal, counsel submits a legal brief and additional evidence. 
With the petition, counsel submitted copies of the following documents: the original Form ETA 750, 
Application for Alien Employment Certification, approved by the U.S. Department of Labor; U.S. Internal 
Revenue Service Form tax returns for 2000 and 2001; a payroll summary report as of August 2003; and, 
copies of documentation concerning the beneficiary's qualifications as well as other documentation. 
Because the director determined the evidence submitted with the petition was insufficient to demonstrate the 
petitioner's continuing ability to pay the proffered wage beginning on the priority date, consistent with 8 
C.F.R. tj 204.5(g)(2), the director requested on March 12, 2004, pertinent evidence of the petitioner's ability to 
pay the proffered wage beginning on the priority date. The director requested evidence in the form of copies of 
annual reports, U.S. federal tax returns with signatures, and audited financial statements from March 26, 2002 to 
the present. The director requested the petitioner provide copies of the beneficiary's W-2 Wage and Tax 
Statements from 1994 until the present. 
In response to the request for evidence of the petitioner's ability to pay the proffered wage beginning on the 
priority date, counsel submitted the petitioner's U.S. Internal Revenue Service (IRS) Form 1120s tax returns for 
years 2001 and 2002; W-2 Wage and Tax Statements; photos of the business; an advertisement; and, a financial 
statement which is a summary of the petitioner's accountant's receivable. 
The director denied the petition on November 1, 2004, finding that the evidence submitted did not establish 
that the petitioner had the continuing ability to pay the proffered wage beginning on the priority date. 
On appeal, counsel asserts that its accountant has determined that the petitioner ". . . has more than met the 
burden of proving its ability to pay the proffered wage." The accountant states that depreciation may be 
added to taxable income to prove the ability to pay in 2002. Further, the accountant contends that the 
petitioner's year end bank balance exceeds the funds necessary to pay the proffered wage according to Matter 
of Sonegawa, 12 I&N Dec. 612 (BIA 1967). 
Counsel has submitted the following additional documents not already submitted to accompany the appeal 
statement: the petitioner's 2003 U.S. federal tax return; and a statement from the petitioner's accountant. 
In determining the petitioner's ability to pay the proffered wage during a given period, U.S. Citizenship and 
Immigration Services (CIS) 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. Evidence was submitted to show that the petitioner employed 
the beneficiary. The petitioner paid the beneficiary $23,089.12 in 2002.' 
1 
 The petitioner paid the beneficiary $42,599.51 in 2001; and, $21,732.68 in 2000. 
Alternatively, in determining the petitioner's ability to pay the proffered wage, CIS will examine the net 
income figure reflected on the petitioner's federal income tax return, without consideration of depreciation or 
other expenses. 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. 111. 1982), affd, 703 
F.2d 571 (7th Cir. 1983). In K. C.P. Food Co., Inc. v. Sava, the court held that the Service 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. Supra at 1084. The court specifically rejected the argument that CIS should have 
considered income before expenses were paid rather than net income. Finally, no precedent exists that would 
allow the petitioner to "add back to net cash the depreciation expense charged for the year." Chi-Feng Chang 
v. Thornburgh, Supra at 537. See also Elatos Restaurant Corp. v. Sava, Supra at 1054. 
The tax returns2 demonstrated the following financial information concerning the petitioner's ability to pay 
the proffered wage of $44,000.00 per year fiom the priority date of March 26,2002: 
In 2002, the Form 1120s stated taxable income of $9,572.00. 
In 2003, the Form 1120s stated taxable income of $13,495.00. 
If the net income the petitioner demonstrates it had available during that period, if any, added to the wages 
paid to the beneficiary during the period,3 if any, do not equal the amount of the proffered wage or more, CIS 
will review the petitioner's assets. 
In 2002, the Form 1120s stated taxable income $9,572.00. The petitioner paid the 
beneficiary $23,089.12 in 2001. The proffered wage is $44,000.00 per year per year. The 
sum of the taxable income loss and the wages paid (i.e. $32,661.12) is less than the proffered 
wage. 
The petitioner's net current assets can be considered in the determination of the ability to pay the proffered 
wage especially when there is a failure of the petitioner to demonstrate that it has taxable income to pay the 
proffered wage. In the subject case, as set forth above, the petitioner did not have taxable income sufficient to 
pay the proffered wage at any time between the years 2002 through 2003 for which the petitioner's tax returns 
are offered for evidence. Also, in the subject case the petitioner has not paid the beneficiary the proffered 
wage in tax year 2002. 
The petitioner's net current assets can be considered in the determination of the ability to pay the proffered 
wage especially when there is a failure of the petitioner to demonstrate that it has taxable income to pay the 
proffered wage. In the subject case, as set forth above, the petitioner did not have taxable income sufficient to 
pay the proffered wage at any time between the years 2002 through 2003 for which the petitioner's tax returns 
are offered for evidence. 
CIS will consider net current assets as an alternative method of demonstrating the ability to pay the proffered 
2 
 Tax returns submitted for years prior to the priority date, have little probative value to show the ability to 
pay the proffered wage. In 2000 the petitioner's taxable income was $5,548.00, and in 2001, $3,290.00. 
3 
The petitioner did not employ the beneficiary in 2003. 
Page 5 
wage. Net current assets are the difference between the petitioner's current assets and current liabilities4 A 
corporation's year-end current assets are shown on Schedule L, lines 1 through 6. That schedule is included 
with, as in this instance, the petitioner's filing of Form 1120s federal tax return. The petitioner's year-end 
current liabilities are shown on lines 16 through 18. If a corporation's end-of-year net current assets are equal 
to or greater than the proffered wage, the petitioner is expected to be able to pay the proffered wage. 
Examining the Form 1120s U.S. Income Tax Returns submitted by the petitioner, Schedule L found in each 
of those returns indicates the following: 
In 2002, petitioner's Form 1120s return stated current assets of $1 10,337.00 and $123,069.00 
in current liabilities. Therefore, the petitioner had <$12,732.00>~ in net current assets. Since 
the proffered wage is $44,000.00 per year, this sum is less than the proffered wage. 
In 2003, petitioner's Form 1120s return stated current assets of $69,594.00 and $82,125.00 in 
current liabilities. Therefore, the petitioner had <$12,53 1.00> in net current assets. Since the 
proffered wage is $44,000.00 per year, this sum is less than the proffered wage. 
Therefore, for the period 2002 through 2003 from the date the Form ETA 750 was accepted for processing by 
the U. S. Department of Labor, the petitioner had not established that it had the ability to pay the beneficiary 
the proffered wage at the time of filing through an examination of its net current assets. 
Counsel asserts in his brief accompanying the appeal that there are other ways to determine the petitioner's 
ability to pay the proffered wage from the priority date. According to regulation,6 copies of annual reports, 
federal tax returns, or audited financial statements are the means by which petitioner's ability to pay is 
determined. 
Petitioner's accountant advocates the addition of depreciation taken as a deduction in those years' tax returns 
to eliminate the abovementioned deficiencies. Since depreciation is a deduction in the calculation of taxable 
income on tax Form 1120S, this method would eliminate depreciation as a factor in the calculation of taxable 
income. 
There is established legal precedent against counsel's contention that depreciation may be a source to pay the 
proffered wage. The court in Chi-Feng Chang v. Thornburg, 719 F. Supp. 532 (N.D. Tex. 1989) noted: 
Plaintiffs also contend that depreciation amounts on the 1985 and 1986 returns are 
non-cash deductions. Plaintiffs thus request that the court sua sponte add back to 
net cash the depreciation expense charged for the year. Plaintiffs cite no legal 
authority for this proposition. This argument has likewise been presented before 
and rejected. See Elatos, 632 F. Supp. at 1054. 
 [CIS] and judicial precedent 
support the use of tax returns and the net incomefigures in determining petitioner's 
ability to pay. Plaintiffs' argument that these figures should be revised by the court 
According to Barron's Dictionary of Accounting Terms 117 (3'd ed. 2000), "current assets" consist of items 
having (in most cases) a life of one year or less, such as cash, marketable securities, inventory and prepaid 
expenses. "Current liabilities" are obligations payable (in most cases) within one year, such as accounts 
payable, short-term notes payable, and accrued expenses (such as taxes and salaries). Id. at 118. 
5 
 The symbols <a number> indicate a negative number, or in the context of a tax return or other financial 
statement, a loss, that is below zero. 
8 C.F.R. 3 204.5(g)(2). 
Page 6 
by adding back depreciation is without support. (Original emphasis.) Chi-Feng at 
537. 
As stated above, following established legal precedent, CIS relied on the petitioner's net income without 
consideration of any depreciation deductions, in its determinations of the ability to pay the proffered wage on 
and after the priority date. 
The petitioner's accountant also contends that the petitioner's year end bank balance exceeds the funds 
necessary to pay the proffered wage according to Matter of Sonegawa, 12 I&N Dec. 612 (BIA 1967). The 
petitioner's accountant advocates the use of the cash balance of the two in the petitioner's bank account is 
misplaced. First, bank statements are not among the three types of evidence, enumerated in 8 C.F.R. 
tj 204.5(g)(2), required to illustrate a petitioner's ability to pay a proffered wage. Whlle this regulation allows 
additional material "in appropriate cases," the petitioner in this case has not demonstrated why the documentation 
specified at 8 C.F.R. tj 204.5(g)(2) is inapplicable or otherwise paints an inaccurate financial picture of the 
petitioner. Second, bank statements show the amount in an account on a gven date, and cannot show the 
sustainable ability to pay a proffered wage. Third, no evidence was submitted to demonstrate that the funds 
reported on the petitioner's bank statements somehow reflect additional available funds that were not reflected on 
its tax return, such as the cash specified on Schedule L that will be considered below in determining the 
petitioner's net current assets. 
The unaudited financial statements that petitioner submitted are not persuasive evidence. According to the 
plain language of 8 C.F.R. tj 204.5(g)(2), where the petitioner relies on financial statements as evidence of a 
petitioner's financial condition and ability to pay the proffered wage, those statements must be audited. 
Unaudited statements are the unsupported representations of management. The unsupported representations 
of management are not persuasive evidence of a petitioner's ability to pay the proffered wage. Thus, the 
unaudited financial statements are of little evidentiary value in this matter 
In the totality of all the evidence submitted in this case, for the years 2002 through 2003, the taxable incomes 
for the petitioner were $9,572.00 and $13,495.00, which are insufficient to pay the proffered wage of 
$44,000.00 per year. The net current asset value for those years is negative <$12,732.00> and <$12,531.00> 
respectively. The petitioner has not paid the beneficiary the proffered wage while in the employ of petitioner. 
Matter of Sonegawa, 12 I&N Dec. 612 (BIA 1967), relates to petitions filed during uncharacteristically 
unprofitable or difficult years but only in a framework of profitable or successful years. 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. 
Unusual and unique circumstances have not been shown to exist in this case to parallel those in Sonegawa, to 
establish that the period examined was an uncharacteristically unprofitable period for the petitioner. By the 
evidence presented,7 the petitioner has not proven its 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. 
Counsel's contentions cannot be concluded to outweigh the evidence presented in the corporate tax returns as 
submitted by petitioner that shows that the petitioner has not demonstrated its ability to pay the proffered 
wage from the day the Form ETA 750 was accepted for processing by any office within the employment 
system of the Department of Labor. 
The burden of proof in these proceedings rests solely with the petitioner. Section 291 of the Act, 8 U.S.C. 
9 1361. The petitioner has not met that burden. 
ORDER: The appeal is dismissed. 
- - - 
7 
 Matter of Sonegawa does not discuss bank accounts.