dismissed EB-3 Case: Automotive

PUBLIC COPY 
U.S. Department of Homeland Security 
20 Mass, N. W. Rm. A3042 
Washington, DC 20529 
U.S. Citizenship 
and Immigration 
Services 
%G 
FILE: WAC 03 0 1 8 54320 Office: CALIFORNIA SERVICE CENTER Date: 
MY 02 2006 
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. 
 1 153(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. 
~Abert P. Wiemann, Chief 
Administrative Appeals Office 
WAC 03 01 8 54320 
Page 2 
DISCUSSION: The preference visa petition was denied by the Director, California Service Center. The 
petitioner filed a motion to reopenlreconsider the decision. The motion was granted by the director. The 
petition remained denied. The petitioner appealed the denial. The Administrative Appeals Office (AAO) 
dismissed the appeal. The petitioner filed a motion to reconsider. The motion will be granted. The petition 
will remain denied. 
The petitioner is a full automotive service and garage business. 
 It seeks to employ the beneficiary 
permanently in the United States as an auto mechanic. 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. 
Section 203(b)(3)(A)(i) of the Immigration and Nationality Act (the Act), 8 U.S.C. 5 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. 3 204.5(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 5 204.5(1)(3)(ii) states, in pertinent part: 
(A) General. Any requirements of training or experience for skilled 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 skilled 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 
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). 
WAC 03 01 8 54320 
Page 3 
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; an offer of 
employment; U.S. Internal Revenue Service Form tax returns for 2000 and 2001; and, copies of Form 941 
"Employer's Quarterly Federal Tax Return." 
Here, the Form ETA 750 was accepted on November 28, 2000. The proffered wage as stated on the Form 
ETA 750 is $734.40 per week ($38,188.80 per year). The Form ETA 750 states that the position requires four 
years experience. 
On appeal, counsel submitted a legal brief and additional evidence. A letter from an accountant was 
submitted. The accountant asserted that depreciation should be considered as an asset. Also, a statement 
from a tax return was submitted, and, a list of expenses. 
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. 5 204.5(g)(2), the director requested on March 27, 2003, pertinent evidence of the petitioner's ability to 
pay the proffered wage beginning on the priority date. The director requested the petitioner's U.S. federal tax 
return for 2002. The director also requested annual reports and audited financial statements. 
In response to the request for evidence of the petitioner's ability to pay the proffered wage beginning on the 
priority date, counsel submitted an explanatory letter and the petitioner's U.S. Internal Revenue Service (IRS) 
Form 1120 tax return for year 2002. 
The director denied the petition on May 22, 2003, 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. 
The petitioner filed a motion to reopenlreconsider. The director granted the motion, and reviewed additional 
evidence that was submitted. The director denied the petition on August 14,2003. 
The AAO found that that the petitioner failed to submit evidence sufficient to demonstrate that it had the ability to 
pay the proffered wage for the years 2001 and 2002. The petitioner appealed the AAO decision on November 12, 
2004. 
On appeal, counsel asserts that the proffered wage should be prorated for 2000; that the petitioner's bank 
statements, its assets, and costs paid for outside services are all evidence of the ability to pay the proffered 
wage. 
Counsel has submitted the following documents to accompany the appeal statement: two bank statements, 
and, approximately 128 invoices and bills of sales. 
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. No evidence was submitted to show that the petitioner 
employed the beneficiary. 
WAC 03 0 18 54320 
Page 4 
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. Ill. 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 returns demonstrated the following financial information concerning the petitioner's ability to pay the 
proffered wage of $38,188.80 per year from the priority date of November 28,2000: 
In 2000, the Form 1 120 stated taxable income' $2 1,205.00. 
In 2001, the Form 1 120 stated taxable income2 $1,223.00. 
In 2002, the Form 1 120 stated taxable income loss of <$1,254.00>~. 
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, if any, do not equal the amount of the proffered wage or more, CIS 
will review the petitioner's assets. No evidence was submitted that the petitioner employed the beneficiary. 
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 2000 through 2002 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 
wage. Net current assets are the difference between the petitioner's current assets and current ~iabilities.~ 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 1120 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. 
Before net operating loss deductions and special deductions. 
* Before net operating loss deductions and special deductions. 
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. 
4 
 According to Barron S Dictionary of Accounting Terms 1 17 (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 as accounts payable, short-term 
notes payable, and accrued expenses (such as taxes and salaries). Id. at 1 18. 
WAC 03 018 54320 
Page 5 
Examining the Form 1120 U.S. Income Tax Returns submitted by the petitioner, Schedule L found in each of 
those returns indicates the following: 
In 2000, petitioner's Form 1120 return stated current assets of $126,906.00 and $100,864.00 in 
current liabilities. Therefore, the petitioner had $26,042.00 in net current assets. Since the proffered 
wage is $38,188.80 per year, this sum is less than the proffered wage. 
In 2001, petitioner's Form 1120 return stated current assets of $76,338.00 and $61,576.00 in current 
liabilities. Therefore, the petitioner had $14,762.00 in net current assets. Since the proffered wage is 
$38,188.80 per year, this sum is less than the proffered wage. 
In 2002, petitioner's Form 1120 return stated current assets of $146,196.00 and $74,626.00 in current 
liabilities. Therefore, the petitioner had $71,570.00 in net current assets. Since the proffered wage is 
$38,188.80 per year, this sum is more than the proffered wage. 
Therefore, for the period 2000 through 2001 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,' 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 counsel 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 1120, 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 incomeJigures 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. 
(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. 
Counsel asserts on the appeal that there is another way to determine the petitioner's ability to pay the 
proffered wage from the priority date by employing the beneficiary and replacing existing outside contractors. 
' 8 C.F.R. 5 204.5(g)(2). 
WAC 03 01 8 54320 
Page 6 
Counsel cites no legal precedent for the contention, and, 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. 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). Compensation already paid to 
others is not available to prove the ability to pay the wage proffered to the beneficiary at the priority date of the 
petition and continuing to the present. Moreover, there is no evidence that the positions of the outside services 
indicated by name involve the same duties as those set forth in the Form ETA 750. The petitioner has not 
documented the position, duty, and termination of the outside that performed the duties of the proffered position. 
Counsel has submitted invoices and bills from an assortment of specialized automotive related services such as an 
auto insurance adjuster, a car radiator repair service, auto parts dealer both dealer and third party, cylinder head 
re-conditioner, transmission shop, and used car part dealer. If that service worker or dealer performed other kinds 
of work or offered retail services other than automobile mechanic, then the beneficiary could not have replaced 
him or her. Based upon the job description (Form ETA 750 Part A, Section 13) for auto mechanic, as well as the 
education certificates found in the record of proceeding, some of the services stated above do not appear to be 
within either the job duties or capabilities of the beneficiary such as auto insurance adjuster, auto parts dealer both 
dealer and third party. 
Counsel asserts that since the priority date is November 28, 2000, the petitioner should be responsible for 
paying a pro-rated portion of the proffered wage corresponding to the remaining days of 2000 from 
November 2ath. If this were the rule, then the petitioner's yearly taxable income would also have to be 
prorated which would eliminate the presumed benefits of pro-ration. Since CIS is attempting to analyze the 
petitioner's ability to pay over a given period of time, it would not be logical to measure income earned over a 
different and longer period of time against the wages earned for the shorter period of time. The AAO reviews 
appeals on a de novo basis. See Dor v. INS, 891 F.2d 997, 1002 n. 9 (2d Cir. 1989). 
Counsel contends that the petitioner's bank statements are evidence of the ability to pay the proffered wage. 
Counsel advocates the use of the cash balance of the business accounts to show the ability to pay the proffered 
wage. Counsel's reliance on the balances 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. 9 204.5(g)(2), required to illustrate a 
petitioner's ability to pay a proffered wage. While 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. 8 204.5(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 given 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. 
We reject the petitioner's assertion that the petitioner's total assets should have been considered in the 
determination of the ability to pay the proffered wage. The petitioner's total assets include depreciable assets 
that the petitioner uses in its business. Those depreciable assets will not be converted to cash during the 
ordinary course of business and will not, therefore, become funds available to pay the proffered wage. 
Further, the petitioner's total assets must be balanced by the petitioner's liabilities. Otherwise, they cannot 
properly be considered in the determination of the petitioner's ability to pay the proffered wage. 
8 C.F.R. 8 204.5(g)(2). 
WAC 03 01 8 54320 
Page 7 
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 three 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. 
5 1361. The petitioner has not met that burden. 
ORDER: 
 The motion to reopen or reconsider is granted. The prior decision of the AAO dated October 12, 
2004, is sustained. The petition remains denied.