dismissed EB-3 Case: Auto Repair

o U.S. Citizenship 
"' and Immigration 
Services 
MATTER OF B-A-E-
Non-Precedent Decision of the 
Administrative Appeals Office 
DATE: OCT. 14, 2016 
APPEAL OF NEBRASKA SERVICE CENTER DECISION 
PETITION: FORM 1-140, IMMIGRANT PETITION FOR ALIEN WORKER 
The Petitioner, a sole proprietor with an auto repair shop, seeks to employ the Beneficiary as an auto 
mechanic. It requests classification of the Beneficiary as a skilled worker under the third preference 
immigrant classification. See Immigration and Nationality Act (the Act) section 203(b)(3)(A)(i), 
8 U.S.C. § 1153(b)(3)(A)(i). This employment-based immigrant classification allows a U.S. 
employer to sponsor a foreign national for lawful permanent resident status to work in a position that 
requires at least 2 years of training or experience. 
As required by statute, the petition is accompanied by a Form ETA 750, Application for Alien 
Employment Certification (labor certification), approved by the United States Department of Labor 
(DOL). Here, the labor certification was accepted on December 23, 2002, which is the priority date. 
The proffered wage as stated on the labor certification is $19.16 per hour ($39,852.80 per year). 
The petition was initially approved on February 16, 2007. Following issuance of a notice of intent to 
revoke (NOIR) related to the Petitioner's ability to pay the beneficiary's proffered wage and raising 
an issue concerning the beneficiary's experience, on December 4, 2015, after, receiving the 
Petitioner's response to the NOIR, the Director, Nebraska Service Center, revoked the approval of 
the petition. The Director determined that the evidence in the record of proceedings does not 
establish the Petitioner's ability to pay the proffered wage from the priority date onward. 
The matter is now before us on appeal. The Petitioner submits evidence of the value of three 
propertie~ owned by the sole proprietor and claims the Directorerred in not considering the value of 
these assets toward establishing the ability to pay the proffered wage. Upon de novo review, we will 
dismiss the appeal. 
I. LAW 
We note that the NOIR was properly issued pursuant to Matter of Arias, 19 I&N Dec. 568 (BIA 
1988) and Matter of Estime, 19 I&N Dec. 450 (BIA 1987). Both cases held that a notice of intent to 
revoke a visa petition is properly issued for "good and sufficient cause" when the evidence of record 
at the time of issuance, if unexplained and unrebutted, would warrant a denial of the visa petition 
based upon the petitioner's failure to meet his burden of proof. 
Matter of B-A-E-
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 establish that its job offer to the beneficiary is a realistic one. Because the filing of 
a labor certification application establishes a priority date for any immigrant petition later based on it, 
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 ofGreat Wall, 16 I&N Dec. 142 (Acting Reg'l Comm'r 1977); see also 
8 C.F.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 of 
Sonegawa, 12 I&N Dec. 612 (Reg'l Comm'r 1967). 
Thus, the petitioner must demonstrate its continuing ability to pay the proffered wage beginning on 
the priority date, which is the date the labor certification was accepted for processing by any office 
within the employment system of the U.S. Department of Labor (DOL). See 8 C.F.R. § 204.5(d). 
Here again, that date is December 23, 2002. 
II. DISCUSSION 
I 
The record indicates that the Petitioner is a sole proprietorship, which is a business in which one 
person operates the business in his or her personal capacity. Black's Law Dictionary 1520 (9th Ed. 
2009). Unlike a corporation, a sole proprietorship does not exist as an entity apart from the 
individual owner. See Matter of United Investment Group, 19 I&N Dec. 248, 250 (Comm'r 1984). 
Therefore, the sole proprietor's adjusted gross iricome, assets and personal liabilities are also 
considered as part of the petitioner's ability to pay. Sole proprietors report income and expenses 
from their businesses on their individual (Form 1 040) federal tax return each year. The business­
related income and expenses are reported on Schedule C and are carried forward to the first page of 
the tax return. Sole proprietors must show that they can cover their existing business expenses as 
well as pay the proffered wage out of their adjusted -gross income or other available funds. In 
addition, sole proprietors must show that they can sustain themselves and their dependents. See 
Ubeda v. Palmer, 539 F. Supp. 647 (N.D. Ill. 1982), aff'd, 703 F.2d 571 (7th Cir. 1983). Thus, in 
determining the petitioner's ability to pay the proffered wage during a given period, USCIS will 
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Matter of B-A-E-
examine the adjusted gross income figure reflected on the sole proprietor's federal income tax 
returns in relation to his or her yearly household expenses. 1 
On October 1, 2015, the Director sent a NOIR to the Petitioner and requested that it provide the sole 
proprietor's list of monthly recurring household expenses and his tax returns for 2006 through 2014. 
The Petitioner responded to the Director's NOIR on November 3, 2015, and provided these tax 
returns and a statement of available income and assets which states the amounts of the sole 
proprietor's annual expenses and resources available to pay the proffered wage from 2003 to 2014. 
The following chart indicates the differences between the sole proprietor's adjusted gross income 
(AGI) as stated on the tax returns and the proffered wage for these years. 
Year Adjusted Gross Annual expenses Difference between the AGI 
Income (AGI) and the annual expenses 
2003 $47,450 $74,000 -$26,550 
2004 $57,380 $74,000 -$16,620 
2005 $37,685 $74,000 -$36,315 
2006 $82,981 $74,000 $8,981 
2007 $92,020 $74,200 $17,820 
2008 $90,374 $77,500 $12,874 
2009 $64,939 $63,300 $1,639 
2010 $72,776 $67,000 $5,776 
2011 $54,352 $68,000 -$13,648 
2012 $49,454 $68,700 -$19,246 
2013 $62,713 $69,800 -$7,087 
2014 $49,885 $71,000 -$21,115. 
This demonstrates that the Sole Proprietor's AGI does not cover his annual expenses and the 
proffered wage of $39,852.80 in any of the years from 2003 to 2014.2 In Ubeda, 539 F. Supp. at 
650, the court concluded that it was highly unlikely that a petitioner could support himself, his 
spouse and five dependents on a gross income of slightly more than $20,000 where the beneficiary's 
proposed salary was $6,000 or approximately thirty percent (30%) of the petitioner's gross income. 
In this case, the Beneficiary's proffered wage is approximately 63% of the average of the sole 
proprietor's adjusted gross income from 2003 to 2014. The above chart indicates that it is 
improbable that the sole proprietor could support his family of four and pay the Beneficiary's 
proffered wage after reducing the AGI by the annual expenses and the proffered wage. In the years 
2003 through 2005 and 2011 through 2014, the sole proprietor's AGI minus his annual expenses are 
1 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)). 
2 We note that the Director did not address the Petitioner's ability to pay the proffered wage in 2002. The tax return for 
2002 states the Sole Proprietor's AGI as $46,411 which appears to be insufficient to pay the Sole Proprietor's annual 
expenses and the Beneficiary's proffered wage. Therefore, the evidence in the record does not demonstrate that the 
Petitioner had the ability to pay the proffered wage in 2002, the year of the priority date. 
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(b)(6)
Matter of B-A-E-
negative numbers. In- the years 2006 through 2010 when the sole proprietor's AGI covered his 
expenses, the amounts remaining are not sufficient to pay even half of the Beneficiary's proffered 
wage. 
On appeal, counsel states th~t we should consider the value of the sole proprietor's homes toward the 
ability to pay the 'proffered wage. The record contains assessments of three properties owned by the 
sole proprietor that were assessed in 2015 as being worth $707,100, $216,811 and $650,646. We 
find that the value of these properties should not be considered in the ability to pay analysis because 
these properties do not represent liquid assets that could be used to pay the Beneficiary's wage. 
The Petitioner states that we should consider the value of these properties because. they could be sold 
. to pay the proffered wage or borrowed against through asset-based lending. To support this 
assertion, the Petitioner cites a document published by entitled, 
5 
The Petitioner cites a portion of this 
document which states , "Asset-based lending offers a powerful financing solution for midsized and 
larger companies that seek to maximize the value of their assets, achieve greater liquidity and pursue 
new growth opportunities." First, we note that two of properties are locations for the business, 
which means it would be unlikely for the Petitioner to sell and liquidate these properties to pay the 
Beneficiary's proffered wage. Second, these properties provide rental income to the business as 
· indicated on the Form 1040, Schedule C, which is carried forward to page one of the Form 1 040 and 
factored into the calculation of AGI.4 Therefore, if these properties were sold to liquidate'the assets, 
the AGI would be lowered in 2003, 2004, and 2006 through 2014.5 
In addition, the Petitioner acknowledges that its business is "not the target enterprise market that 
is courting" but states that, regardless of that fact, asset-based lending is a practice 
used in the ordinary course of business. The fact that asset-based lending is a practice used by some 
businesses does not demonstrate that it is an option available to the sole proprietor to. use to pay the 
proffered wage. This document states on page four that "[ c ]ompanies of all sizes can qualify for 
[asset-based lending] as long as their business is a good match for the characteristics that asset-based 
lenders look for. For midsize companies, annual revenues between $35 million and $250 million are 
typical of today's borrowers." Thus, asset-based lending appears to be available for midsized to 
large companies with a significant amount of annual revenues. The Petitioner, with annual revenues 
between $300,000 and $390,
000, has not demonstrated that asset-based lending would be available 
in this case to pay the proffered wage. 
3 See White Paper, 
4 
The tax returns for 20o3 and 2004 state amounts of rent received in Schedule C for one of the properties at 
California. The tax returns for 2005 through 2014 state amounts of rent received in 
Schedule C for two of the properties : the location, and the property at 
California. 
5 The only year that is an exception to this is 2005 when the amount of rent indicated in Schedule C is a loss. 
4 
Matter of B-A-E-
Even if asset-based lending was available to the sole proprietor, USCIS will give less weight to loans 
and debt as a means of paying salary since the debts will increase the sole proprietor's liabilities and 
will not improve his overall financial position. Although lines of credit and debt are an integral part 
of any business operation, USCIS must evaluate the overall financial position of a petitioner to 
determine whether the employer is making a realistic job offer and has the overall financial ability to 
satisfy the proffered wage. See Matter of Great Wall, 16 I&N Dec. 142 (Acting Reg'l Comm'r 
1977). Therefore, the sole proprietor's ability to pay the proffered wage has not been established. 
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). USCIS may, at its discretion, consider evidence relevant to the petitioner's 
financial ability that falls outside of a petitioner's adjusted gross income compared to its expenses. 
US CIS may consider such factors as the number of years the petitioner has been doing business, the 
established historical grpwth 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 Form I -140 states that the Petitioner has been in business since 1985 and had 
five employees as of February 2006 when the Form I-140 was signed. The sole proprietor's tax 
returns indicate that his AGI has decreased in each year from 2007 to 2009 and from 2010 to 2012. 
The tax returns also indicate that the average annual amount of wages paid to all employees from 
2003 through 2014 is $29,845. The total wages for all employees is less than the beneficiary's 
proffered wage. It is unlikely that the Petitioner would be able to double the amount of wages paid. 
The record does not contain any other evidence establishing that these tax returns present an 
inaccurate picture of the sole proprietor's financial outlook. The record does not contain any 
evidence of the Petitioner's reputation in the industry or that the sole proprietor incurred any 
unexpected costs from 2003 to 2014. Thus,, assessing the totality of the circumstances in this case, 
we conclude that it has not been established that the sole proprietor had the continuing ability to pay 
the proffered wage. 
III. CONCLUSION 
For the reasons discussed above, it has not been established that the Petitioner had the ability to pay 
the proffered wage to the Beneficiary from the priority date onward. 
In visa petition proceedings, it is the petitioner's burden to establish eligibility for the immigration 
benefit sought. Section 291 ofthe Act, 8 U.S.C. § 1361; Matter ofOtiende, 26 I&N Dec. 127, 128 
(BIA 2013). The petitioner has not met that burden. 
ORDER: The appeal is dismissed. 
Cite as Matter ofB-A-E-, ID# 175718 (AAO Oct. 14, 2016) 
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