dismissed EB-3 Case: Automobile Repair

identifying data deleted to 
. preverat dearly unwarranted 
- 
inrmion peiLnal privacy 
PUBLIC COPY 
U.S. Department of IIomeland Security 
20 Mass. Ave., N.W., Rm. 3000 
Washington, DC 20529 
U.S. Citizenship 
and Immigration 
L* 
Office: VERMONT SERVICE CENTER 
 Date: s~p Q 5 2006 
EAC 03 254 5 1549 
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. 3 1153(b)(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 
DISCUSSION: The preference visa petition was denied by the Director, Vermont Service Center, and is 
now before the Administrative Appeals Office (AAO) on appeal. The appeal will be dismissed. 
The petitioner is an automobile repair company. It seeks to employ the beneficiary permanently in the United 
States as an automobile body repairer. As required by statute, the petition is accompanied by a Form ETA 
750, Application for Alien 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 4, 2004 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)(3)(A)(i) of the Immigration and Nationality Act (the Act), 8 U.S.C. 9 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 slulled 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 8 C.F.R. fj 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 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 DOL. See 8 CFR fj 204.5(d). The petitioner 
must also demonstrate that, on the priority date, the beneficiary had the qualifications stated on its Form ETA 
750, Application for Alien Employment Certification, as certified by the DOL and submitted with the instant 
petition. Matter of Wing's Tea House, 16 I&N Dec. 158 (Act. Reg. Cornrn. 1977). 
Here, the Form ETA 750 was accepted on April 30, 2001. The proffered wage as stated on the Form ETA 
750 is $24.31 per hour ($50,564.80 per year based on a 40 hour work week). The Form ETA 750 states that 
the position requires two years of experience in the job offered. 
The AAO takes a de novo look at issues raised in the denial of this petition. See Dor v. INS, 891 F.2d 997, 
1002 n. 9 (2d Cir. 1989)(noting that the AAO reviews appeals on a de novo basis). The AAO considers all 
Page 3 
pertinent evidence in the record, including new evidence properly submitted upon appeal.' 
 On appeal, 
counsel submits a brief, the petitioner's previously submitted IRS Forms 1120S, U.S. Income Tax Returns for 
an S Corporation, for 2001, 2002 and 2003, the petitioner's previously submitted IRS Forms 941, Employer's 
Quarterly Federal Tax Returns, for 2002, 2003 and the first two quarters of 2004, IRS Forms 1065, U.S. 
Returns of Partnership Income, fo for 2001 and 2002, the beneficiary's 
previously submitted for 2001, 2002 and 2003, a letter dated 
December 1, 2004 fkom IRS Forms 1040, U.S. Individual Income Tax 
Returns, 2002 and 2003 and IRS Forms 1040, U.S. 
Individual Income Tax Returns, for 
 for 200 1, 2002 and 2003. Other 
relevant evidence in the record includes copies of the beneficiary's paychecks issued by the petitioner for 
April and May 2004. The record does not contain any other evidence relevant to the petitioner's ability to pay 
the wage. 
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 1988 and to currently employ four workers. 
According to the tax returns in the record, the petitioner's fiscal year is based on a calendar year. On the 
Form ETA 750B, signed by the beneficiary on April 26, 2001, the beneficiary did not claim to have worked 
for the petitioner. 
On appeal, counsel asserts that the petitioner's business was negatively affected by the events of the terrorist 
attacks on September 11, 2001. He states that the petitioner's business is located near the former World 
Trade Center site in New York, and that the petitioner lost substantial business in the last part of 2001 and the 
first part of 2002 when access to the Holland Tunnel, which served as access to the World Trade Center, was 
restricted due to state travel regulations. He states that the events of September 11 caused a general decline in 
the area's consumer spending and particularly affected automobile industries. Counsel cites Matter of 
Sonegawa, 12 I&N Dec. 612 (Reg. Cornm. 1967), for the proposition that an uncharacteristically unprofitable 
year can be overlooked in certain circumstances. Counsel asserts that the petitioner's net profit, cash and current 
assets listed on Schedule L of its federal income tax return and depreciation should be considered in the 
determination of its ability to pay the proffered wage, and that the profits of a partnership owned by the 
petitioner's two shareholders should be considered in the ability to pay determination. Counsel also states that the 
petitioner's shareholders have agreed to guarantee the payment of the proffered wage with their personal funds. 
He cites Full Gospel Portland Church v. Thornburgh, 730 F. Supp. 441 (D.D.C. 1988), and Elatos Restaurant 
Corp. v. Suva, 632 F. Supp. 1049 (S.D.N.Y. 1986), for the proposition that undertakings of others to pay the 
proffered wage are acceptable evidence of a petitioner's ability to pay the wage. Counsel also asserts that the 
Subchapter S status of the corporation and the flow-through payments to its shareholders should be considered in 
the ability to pay determination. 
The petitioner must establish that its job offer to the beneficiary is a realistic one. Because the filing of an 
ETA 750 labor certification application establishes a priority date for any immigrant petition later based on the 
ETA 750, 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. Comm. 1977). See also 8 C.F.R. 3 204.5(g)(2). In 
1 
The submission of additional evidence on appeal is allowed by the instructions to the Form I-290B, which 
are incorporated into the regulations by the regulation at 8 C.F.R. 5 103.2(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 I&N Dec. 764 (BLA 1988). 
Page 4 
evaluating whether a job offer is realistic, Citizenship and Immigration Services (CIS) 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. Cornm. 1967). 
In determining the petitioner's ability to pay the proffered wage during a given period, 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. In the 
instant case, on the Form ETA 750B, signed by the beneficiary on April 26, 2001, the beneficiary did not 
claim to have worked for the petitioner. However, the beneficiary's IRS Forms W-2 for 2001,2002 and 2003 
show compensation received from the petitioner, as shown in the table below. 
In 200 1, the Form W-2 stated compensation of $23,400.00. 
In 2002, the Form W-2 stated compensation of $33,800.00. 
In 2003, the Form W-2 stated compensation of $33,800.00. 
The beneficiary's paychecks for 2004 showed compensation received from the petitioner of $3,308.34. 
Therefore, for the years 2001, 2002, 2003 and 2004, the petitioner has not established that it employed and 
paid the beneficiary the full proffered wage, but it did establish that it paid partial wages each year. Since the 
proffered wage is $50,564.80 per year, the petitioner must establish that it can pay the difference between the 
wages actually paid to the beneficiary and the proffered wage, which is $27,164.80, $16,764.80, $16,764.80 
and $47,256.46 in 2001,2002,2003 and 2004, respectively.2 
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, CIS will next 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. Ill. 1982), afd, 703 F.2d 571 (7th Cir. 1983). 
The court in Chi-Feng Chang noted: 
Plaintiffs also contend the 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 
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. 
(Emphasis in original.) Chi-Feng at 537. 
2 
 This office notes that the record does not contain the petitioner's 2004 federal income tax return. 
Therefore, the petitioner's net income and net current assets may not be analyzed against the difference 
between the wages actually paid to the beneficiary and the proffered wage in 2004. 
Page 5 
The record before the director closed on August 20, 2004 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 2003 federal 
income tax return is the most recent return available. The petitioner's tax returns demonstrate its net income 
for 2001,2002 and 2003, as shown in the table below. 
In 2001, the Form 1120s stated net income3 of -$15,030.00. 
In 2002, the Form 1120s stated net income of -$5,074.00. 
In 2003, the Form 1120s stated net income of $12,709.00. 
Therefore, for the years 2001, 2002 and 2003, the petitioner did not have sufficient net income to pay the 
difference between the wages actually paid to the beneficiary and the proffered wage. 
As an alternate means of determining the petitioner's ability to pay the proffered wage, CIS may review the 
petitioner's net current assets. Net current assets are the difference between the petitioner's current assets and 
current liabilitie~.~ A corporation's year-end current assets are shown 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 
tax returns demonstrate its end-of-year net current assets for 2001, 2002 and 2003, as shown in the table 
below. 
In 2001, the Form 1120s stated net current assets of $18,185.00. 
In 2002, the Form 1120s stated net current assets of $32,502.00. 
In 2003, the Form 1120s stated net current assets of $28,588.00. 
Therefore, for the year 2001, the petitioner did not have sufficient net current assets to pay the difference 
between the wages actually paid to the beneficiary and the proffered wage. For the years 2002 and 2003, the 
petitioner had sufficient net current assets to pay the difference between the wages actually paid to the 
beneficiary and the proffered wage. 
Thus, for the year 2001, 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. 
Counsel asserts in his brief accompanying the appeal that there is another way to determine the petitioner's 
continuing ability to pay the proffered wage from the priority date. He states that the petitioner's shareholders 
have agreed to guarantee the payment of the proffered wage with their personal funds. He cites Full' Gospel 
Portland Church v. Thornburgh, 730 F. Supp. 441 (D.D.C. 1988), and Elatos Restaurant Corp. v. Sava, 632 
F. Supp. 1049 (S.D.N.Y. 1986), for the proposition that undertalungs of others to pay the proffered wage are 
acceptable evidence of a petitioner's ability to pay the wage. The decision in Full Gospel is not binding here. 
3 
Ordinary income (loss) from trade or business activities as reported on Line 21. 
4 
 According to Barron 's Dictionary of Accounting Terms 117 (31d 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 accounts 
payable, short-term notes payable, and accrued expenses (such as taxes and salaries). Id. at 118. 
Although the AAO may consider the reasoning of the decision, the AAO is not bound to follow the published 
decision of a United States district court in cases arising within the same district. See Matter of K-S-, 20 I&N 
Dec. 7 15 (BIA 1993). Further, the decision in Full Gospel is distinguishable from the instant case. The court 
in Full Gospel ruled that CIS should consider the pledges of parishioners in determining a church's ability to 
pay the wages of a sponsored alien. Here, however, the petitioner is a corporation, not a church. 
Additionally, the petitioner in Elatos asked CIS to consider its gross income instead of net income in the 
determination of its ability to pay the proffered wage, and the judge determined that CIS properly considers 
net income for both individuals and corporations. Therefore, Elatos does not allow CIS to consider the 
personal resources of the individual shareholders of the corporation as counsel suggests. 
Further, financial information about the shareholders of the petitioner,-an 
blish the ability of the petitioner to pay the proffered wage since the petitioner is a corporation. 
and 
 are not legally liable for the financial obligations of the corporation. w~ Contrary to 
counsel's assertion, CIS may not "pierce the corporate veil" and look to the assets of the corporation's owners 
to satisfy the corporation's ability to pay the proffered wage. It is an elementary rule that a corporation is a 
separate and distinct legal entity from its owners and shareholders. See Matter of M, 8 I&N Dec. 24 (BIA 
1958), Matter of Aphrodite Investments, Ltd., 17 I&N Dec. 530 (Comm. 1980), and Matter of Tessel, 17 I&N 
Dec. 631 (Act. Assoc. Comm. 1980). Consequently, assets of its shareholders or of other enterprises cannot 
be considered in determining the petitioning corporation's ability to pay the proffered wage. 
Additionally, althoug f hand submitted an affidavit stating their desire to guarantee 
the payment of the wages o t e eneficiary, that affidavit does not appear to be legally enforceable as a 
guarantee. The affidavit lacks the period of the purported guarantee. ~urther, the affidavit is dated December 1, 
2004, nearly three years after the nori 
 date. Even if enforceable as a guarantee of the future wages of the 
beneficiary, the affidavit o & and could not help to establish the ability of the 
petitioner to pay the proffered wage in 2001. With the 1-140 petition, evidence is required of a sponsoring 
employer's ability to pay a proffered wage as of the priority date, not its guarantee to support the beneficiary 
in the future. 8 C.F.R. 
 204.5(g)(2). 
Counsel urges that the petitioner's Schedule L Cash should be added to its net profits in calculating the funds 
available to the petitioner to pay the proffered wage. That calculation would be inappropriate. Some portion 
of the petitioner's revenue during a given year is paid in expenses and the balance is the petitioner's net 
income. Of its net income, some is retained as cash. Adding the petitioner's Schedule L Cash to its net 
income would likely be duplicative, at least in part. The petitioner's Schedule L Cash is included in the 
calculation of the petitioner's net current assets, which are considered separately from its net income. 
Although CIS will not consider gross income without also considering the expenses that were incurred to 
generate that income, the overall magnitude of the entity's business activities should be considered when the 
entity's ability to pay is marginal or borderline. See Matter of Sonegawa, 12 I&N Dec. 612 (Reg. Comm. 
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 
Page 7 
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, CIS 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. CIS 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 CIS deems relevant to the petitioner's ability to pay the 
proffered wage. The petitioner was incorporated in 1988. The petitioner's gross receipts steadily increased 
from 2001 to 2003. However, the petitioner paid minimal salaries and wages in the years 2001, 2002 and 
2003, with a large portion of wages paid to the beneficiary. The record shows that the petitioner employed no 
more than four employees during the relevant period. Counsel asserts that the petitioner's business was 
negatively affected by the events of the terrorist attacks on September 11, 2001. However, other than the 
petitioner's 2001 through 2003 tax returns, counsel provides no evidence to support his assertions, such as 
evidence of the petitioner's receipt of payments from 911 1 relief hnds or the petitioner's tax returns prior to 
2001 to establish that the petitioner's 2001 losses were uncharacteristic. The record contains no evidence of 
the petitioner's reputation within its industry. Going on record without supporting documentary evidence is 
not sufficient for purposes of meeting the burden of proof in these proceedings. Matter of Soflci, 22 I&N 
Dec. 158, 165 (Cornm. 1998) (citing Matter of Treasure Craft of California, 14 I&N Dec. 190 (Reg. Comm. 
1972)). Thus, assessing the totality of circumstances in this individual case, it is concluded that the petitioner 
has not established that it had the ability to pay the proffered wage in 2001. 
Finally, counsel is correct in his assertion that the shareholders of an S corporation have the authority to 
allocate expenses of the corporation for various legitimate business purposes, including for the purpose of 
reducing the corporation's taxable income. However, counsel has not established how the petitioner's 
shareholders would have allocated expenses differently in order to establish the petitioner's ability to pay the 
proffered wage in 2001 .5 
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 Form ETA 750 was accepted for processing by the DOL. 
The evidence submitted does not establish that the petitioner had the continuing ability to pay the proffered 
wage beginning on the priority date. 
The burden of proof in these proceedings rests solely with the petitioner. Section 291 of the Act, 8 U.S.C. 
$ 1361. The petitioner has not met that burden. 
5 
 This office notes that a denial of an 1-140 petition is without prejudice to the petitioner submitting a new I- 
140 based on the same approved ETA 750 labor certification. Cf: 8 C.F.R. §$ 103.2 (a)(7)(ii) (new fees will 
be required with any new petition), 103.2(b)(15) (withdrawal of a petition or denial of a petition due to 
abandonment does not preclude the filing of a new petition with a new fee). However, any new petition 
submitted by the petitioner would have to be supported by evidence sufficient to establish the petitioner's 
ability to pay the proffered wage as of the priority date and continuing until the beneficiary obtains lawful 
permanent residence, including the years since the record closed in the instant petition. 
Page 8 
ORDER: The appeal is dismissed.