sustained EB-3 Case: Culinary Arts

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PUBLIC COPY 
U.S. Department of Homeland Security 
20 Mass. Ave., N.W., Rm. A3042 
Washington, DC 20529 
U.S. Citizenship 
and Immigration 
FILE: EAC-03- 180-50 132 Office: VERMONT SERVICE CENTER Date: MAR 2 1 2008 
IN RE: Petitioner: 
Beneficiary: fi 
PETITION: 
 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 1153(b)(3) 
ON BEHALF OF PETITIONER: SELF-REPRESENTED 
INSTRUCTIONS: 
This is the decision of the Administrative Appeals Office in your case. All documents have been returned to 
the office that originaIly decided your case. Any further inquiry must be made to that office. 
Robert P. Wiemann, Director 
Administrative Appeals Office 
EAC-03 -1 80-50 132 
Page 2 
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 sustained. The petition 
will be approved. 
The petitioner is a restaurant. It seeks to employ the beneficiary permanently in the United States as a foreign 
specialty cook, Spanish and Portuguese dishes. As required by statute, a Form ETA 750, Application for 
Alien Employment Certification approved by the Department of Labor, accompanied the petition. 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 and denied the petition 
accordingly. 
Section 203(b)(3)(A)(i) of the Immigration and Nationality Act (the Act), 8 U.S.C. tj 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 or seasonal nature, for which qualified workers are not available in the United 
States. 
The regulation at 8 C.F.R. 8 204.5(g)(2) states: 
Ability ofprospective 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. In a case 
where the prospective United States employer employs 100 or more workers, the director 
may accept a statement from a financial officer of the organization which establishes the 
prospective employer's ability to pay the proffered wage. In appropriate cases, additional 
evidence, such as profit/loss statements, bank account records, or personnel records, may be 
submitted by the petitioner or requested by [Citizenship and Immigration Services (CIS)]. 
The petitioner must demonstrate the continuing ability to pay the proffered wage beginning on the petition's 
priority date, which is the date the Form ETA 750 was accepted for processing by any office within the 
employment system of the Department of Labor. See 8 C.F.R. tj 204.5(d). The priority date in the instant 
petition is December 6, 1996. The proffered wage as stated on the Form ETA 750 is $15.75 per hour, which 
amounts to $32,760.00 annually. On the Form ETA 750B, first signed by the beneficiary on November 25, 
1996, and then corrected by the beneficiary on June 15, 1999, the beneficiary claimed to have worked for the 
petitioner beginning in April 1993 and ending in January 1998. The ETA 750 was certified by the 
Department of Labor on October 20, 1999. 
The 1-140 petition was submitted on May 29, 2003. On the petition, the petitioner claimed to have been 
established on November 1, 1990, to currently have eight employees, to have a gross annual income of 
$615,000.00, and to have a net annual income of $37,000.00. With the petition, the petitioner submitted 
supporting evidence. 
In a request for evidence (RFE) dated April 23, 2004, the director requested additional evidence relevant to 
the beneficiary's experience and additional evidence relevant to the petitioner's continuing ability to pay the 
proffered wage beginning on the priority date. 
EAC-03-180-50132 
Page 3 
In response to the WE, the petitioner submitted additional evidence. The petitioner's submissions in response 
to the RFE were received by the director on July 17,2004. 
In a decision dated August 3 1,2004, the director determined that the evidence did not establish that the petitioner 
had the ability to pay the proffered wage as of the priority date and continuing until the beneficiary obtains lawful 
permanent residence, and denied the petition. 
On appeal, the petitioner submits a brief and no other evidence. The brief is signed by the petitioner's 
manager. In the brief, in addition to discussing evidence previously submitted for the record, the manager 
makes several additional factual assertions. Since the brief is signed by the principal's manager, rather than 
by an attorney, and since it contains factual assertions, the brief itself is an evidentiary document. 
In his brief, the petitioner's manager states that the director failed to consider payment for compensation of 
officers of $80,600.00 in 1996, which was a lump sum payment. The manager states that the petitioner's loss 
of $9,422.00 that year was the result of depreciation and trades made during that year. The manager states 
that since 1996 all employees have been paid in full and on time, and that all payroll taxes have been paid to 
appropriate governmental agencies. The manager states that the business has continued to grow, and that 
since 2004 the petitioner has also had a catering service which has greatly increased the business. The 
manager also states that it has been very difficult to recruit qualified cooks for the Portuguese and Spanish 
dishes featured by the petitioner. 
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. 4 103.2(a)(l). The record in the instant case 
provides no reason to preclude consideration of any of the factual assertions of the petitioner's manager 
contained in the brief submitted on appeal. See Matter of Soriano, 19 I&N Dec. 764 (BIA 1988). 
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. 4 204.5(g)(2). In 
evaluating whether a job offer is realistic, 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 of Sonegawa, 12 I&N Dec. 
612 (Reg. Comm. 1967). 
In determining the petitioner's ability to pay the proffered wage, CIS will first examine whether the petitioner 
employed the beneficiary at the time the priority date was established. If the petitioner establishes by 
documentary evidence that it employed the beneficiary at a salary equal to or greater than the proffered wage, 
this 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, first signed by the beneficiary on November 25, 1996 and then corrected by 
the beneficiary on June 15, 1999, the beneficiary claimed to have worked for the petitioner beginning in April 
1993 and ending in January 1998. Moreover in the petitioner's brief, submitted on November 2, 2004, the 
petitioner's manager states that the beneficiary is considered as a key employee of the petitioner. Nonetheless, 
the record contains no copies of any Fonn W-2 Wage and Tax Statements of the beneficiary nor other evidence 
of any compensation paid by the petitioner to the beneficiary. 
EAC-03-180-50132 
Page 4 
As another means of determining the petitioner's ability to pay the proffered wage, CIS will next examine the 
petitioner's net income figure as reflected on the petitioner's federal income tax return for a given year, 
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 Cop. v. Sava, 632 F. Supp. 1049, 1054 (S.D.N.Y. 1986) (citing Tongatapu Woodcraft Hawaii, Ltd. v. 
Feldrnan, 736 F.2d 1305 (9" Cir. 1984)); see also Chi-Feng Chang v. Thornburgh, 719 F. Supp. 532 (N.D. Tex. 
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 (7" Cir. 1983). In K.C.P. Food Co., Inc., the court held that the Immigration 
and Naturalization Service, now CIS, 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. 623 F. Supp. at 1084. The 
court specifically rejected the argument that the Service should have considered income before expenses were 
paid rather than net income. Finally, there is no precedent that would allow the petitioner to "add back to net cash 
the depreciation expense charged for the year." See Elatos Restaurant Corp., 632 F. Supp. at 1054. 
The evidence indicates that the petitioner is an S corporation. The record contains copies of the petitioner's Form 
1 120s U.S. Income Tax Returns for an S Corporation for 1996, 1997, 1998, 1999, 2000, 2001, 2002 and 2003. 
The record before the director closed on July 17, 2004 with the receipt by the director of the petitioner's 
submissions in response to the RFE. As of that date the petitioner's federal tax return for 2003 was the most 
recent return available. 
Where an S corporation's income is exclusively from a trade or business, CIS considers net income to be the 
figure for ordinary income, shown on line 2 1 of page one of the petitioner's Form 1 120s. The instructions on the 
Form 1120s U.S. Income Tax Return for an S Corporation state on page one, "Caution: Include only trade or 
business income and expenses on lines la through 21 ." Where an S corporation has income from sources other 
than from a trade or business, that income is reported on Schedule K. An S corporation's total income from its 
various sources are reported on lines 1 through 6 of the Schedule K, Shareholders' Shares of Income, Credits, 
Deductions, etc. For example, an S corporation's rental real estate income is carried over from the Form 8825 to 
line 2 of Schedule K. See Internal Revenue Service, Instructions for Form 1120s (2003), available at 
http://www.irs.gov/pub/irs-pdi 1 120s--2003 .pdc Instructions for Form 1 120s (2002), available at 
http://www.irs.gov/pub/irs-priorli 1 120s--2002.pdf. 
Similarly, some deductions appear only on the Schedule K. The cost of business property elected to be treated an 
expense deduction under Section 179 of the Internal Revenue Code, rather than as a depreciation deduction, is 
carried over from line 12 of the Form 4562 to line 8 of the Schedule K. See Internal Revenue Service, 
Instructions for Form 4562 (2003), at 1, available at http://www.irs.gov/pub/irs-prior/i4562--2003.pdf; Internal 
Revenue Service, Instructions for Form 1 120s (2003), at 22, available at http://www.irs.gov/pub/irs-priorli 1 120s- 
-2003 .pdf. 
Where the Schedule K has relevant entries for either additional income or additional deductions, net income is 
found on Line 23 of the Schedule K, for income. 
In the instant petition, the petitioner's tax returns indicate no income from activities other than from a trade or 
business, but they indicate additional relevant deductions for charitable contributions and for section 179 business 
property expense deductions. Therefore the figures for ordinary income on line 21 of page one of the petitioner's 
Form 1120s tax returns do not include all of its relevant deductions. For this reason, the petitioner's net income 
is shown on Line 23 of the Schedule K, for income, as shown in the table below. 
EAC-03-180-50132 
Page 5 
Tax Wage increase needed Surplus or 
year Net income to pay the proffered wage deficit 
* The full proffered wage, since the record contains no evidence of any wage 
payments made by the petitioner to the beneficiary. 
The above information is insufficient to establish the petitioner's ability to pay the proffered wage in 1996, 
1997, 1998,2000, or 2001. For 2002 and 2003 the above information is sufficient to establish the petitioner's 
ability to pay the proffered wage. 
As an alternative means of determining the petitioner's ability to pay the proffered wages, CIS may review 
the petitioner's net current assets. Net current assets are a corporate taxpayer's current assets less its current 
liabilities. Current assets include cash on hand, inventories, and receivables expected to be converted to cash 
within one year. A corporation's current assets are shown on Schedule L, lines 1 through 6. Its current 
liabilities are shown on lines 16 through 18. If a corporation's net current assets are equal to or greater than 
the proffered wage, the petitioner is expected to be able to pay the proffered wage out of those net current 
assets. The net current assets are expected to be converted to cash as the proffered wage becomes due. Thus, 
the difference between current assets and current liabilities is the net current assets figure, which if greater 
than the proffered wage, evidences the petitioner's ability to pay. 
Calculations based on the Schedule L's attached to the petitioner's tax returns yield the amounts for net 
current assets as shown in the following table. 
Tax Net Current Assets Wage increase needed 
year Beginning of year End of year to pay the proffered wage 
* The full proffered wage, since the record contains no evidence of any wage 
payments made by the petitioner to the beneficiary. 
EAC-03-180-50132 
Page 6 
The above information is insufficient to establish the petitioner's ability to pay the proffered wage in 1996, 
1997, or 1998. In 1999, 2000, 2001, 2002 and 2003, the year-end net current assets are greater than the 
proffered wage. Therefore the above information is sufficient to establish the petitioner's ability to pay the 
proffered wage in those years. 
In his brief, the petitioner's manager states that in 1996 the petitioner's two officers were paid a lump sum in the 
amount of $80,600.00. The manager states that that figure should be considered as part of the petitioner's 
financial resources. The manager states that the petitioner paid an additional $40,389.00 in salaries and wages for 
its two employees that year and that it had a loss of $9,422.00 pertaining to depreciation of equipment and to 
trades that were made for that year. 
CIS may not "pierce the corporate veil" and look to the assets of the corporation's owner to satisfy the 
corporation's ability to pay the proffered wage. It is basic rule of law concerning corporations 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); Matter of 
Tessel, 17 I&N Dec. 631 (Act. Assoc. Comm. 1980). Consequently, assets of its shareholders or of other 
enterprises or corporations cannot be considered in determining the petitioning corporation's ability to pay the 
proffered wage. 
Nonetheless, under the principles of Matter of Sonegawa, 12 I&N Dec. 612 (Reg. Comrn. 1967), CIS may 
consider the totality of the circumstances affecting the petitioner's ability to pay the proffered wage. The 
shareholders of a 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. Compensation of 
officers is an expense category explicitly stated on the Form 1120s U.S. Income Tax Return for an S Corporation. 
The petitioner's expenses deductions for compensation of officers are as follows: 
 $80,600.00 in 1996; 
$88,800.00 in 1997; $86,400.00 in 1998; $86,400.00 in 1999; $86,400.00 in 2000; $84,000.00 in 2001; 
$84,000.00 in 2002; and $86,400.00 in 2003. Each of those amounts is greater than the proffered wage of 
$32,760.00. 
In his brief, the petitioner's manager states that from 1996 to the present the business has increased significantly. 
That statement is corroborated by information in the petitioner's tax returns which show the amounts for gross 
receipts or sales, gross profit, and total income in the amounts shown in the following table. 
Forms 1 120S, Income, Lines lc, 3 & 6 
Year 
Gross receipts 
or sales Gross Profit Total Income 
EAC-03-180-50132 
Page 7 
The above figures show steady increases in gross receipts or sales each year, and in gross profit and total income 
each year. 
For the years 1999,2000,2001,2002 and 2003, the above analysis of the petitioner's net income and year-end net 
current assets show that one or both of those figures are higher than the proffered wage. For the years 1996, 1997 
and 1998, the evidence of the petitioner's payments for compensation of officers and of its increasing figures for 
gross receipts or sales, gross profit and total income are also sufficient to establish the petitioner's ability to pay 
the proffered wage. Therefore, considering the totality of the circumstances, the evidence in the record is 
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. See Matter of Sonegawa, 12 I&N Dec. 612 (Reg. Comrn. 
1967). 
In his decision, the director stated the petitioner's net income in each of the years at issue and calculated the 
petitioner's year-end net current assets for each of those years. The director failed to note the additional 
relevant deductions on the Schedule K's attached to the petitioner's tax returns, which somewhat reduced the 
petitioners net income. However, those deductions were not large enough to affect the director's conclusions. 
The director found that for 1996, 1997 and 1998 both net income and year-end net current assets were less 
than the offered wage. The director found that for 1999, 2000, 2001, 2002 and 2003 the evidence did 
establish the petitioner's ability to pay the proffered wage. 
The director did not discuss the petitioner's expenses for compensation of officers, nor its figures for gross 
receipts or sales, gross profit, and total income, nor did the director conduct any other analysis based on the 
principles of Matter of Sonegawa, 12 I&N Dec. 612 (Reg. Cornrn. 1967). However, in certain circumstances it is 
appropriate to do so. For the reasons stated above, the assertions of the petitioner's manager on appeal are 
sufficient to overcome the decision of the director. 
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 met that burden. 
ORDER: 
 The appeal is sustained. The petition is approved.