sustained EB-3 Case: Dentistry

Roben 1'. Wirmanr;, Chief' 
~~dminis&i[iiTe Appezls CPifif'icr 
DISCH.iSS[ON: '6'I?t. prefet.rer;ce visa pettion was cferiicd by the Direcior, Vermont Service Clearer, k'tiid is 
31ou: belore the ~drninistrative Appeals Office (AA(S) on appeal. 'T'rre appeal will be sustained. 
'We pet;;ji>iler is a der?.tist. It seeks ti? e~?:ptoy the benei-iciat-y pei-n;ir~enlly in lfre IJnited Slates as rt derital 
assistant. As reyuir-ed by stattire, tlie petition is accrt~npanieJ by a Forlr, E7'A 750, ilpplication for Alien 
En~ployn-tent Certification (labor- cerii5zatic3~1 or the Folm E'I'A 750). approved by ihe Ijeparlment of I,nbor. 
Tbc dir-ector ciett.nnined that tile petitloser Itnd not established 'that it had tile cor?tinuing ability to paji the 
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beneficiary the prufl'cr~:d wage bcginriing on the plor;:;?; -date of the visa pelitio~?. Tbe direeti)~ dcnied The 
j?ctition accorilir~gly. 
Clr~ appeal, counsel submits ;t brief stait.r~:zr:t a1.d ajdillonai evidence.' 
Section 203(b)(:l.){A)(i) of ths Immigi-aiiali arrd Nlttionality Act (tho Act), 8 i,F.S.!.;1. 8 1 153{b)/3j(iZ)(ij2 
PI-cryiides for ihr gra-ntjng of preference ciassifica:ioi; lo qualified i~-r~m;g.ant:: who arc c:apab.ie. at the tirne of 
petj~ion~ng Tbr classiiication under this paiagl-api:, of pel-fijm~.i~-rg skilled labor. ireyuirjng at least twc, year:: 
iraij?ing or expsi-~e:r~se), not of temg(:jrxY mtur-e, fc:rr i~hic.)~ qua ii fied vv-c?r.ker-s are not a:railab!tx iii the t lnitt>ri 
States. 
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i $ti segu!;:!iciri S C::.F.K. 9 704.S{giC& states in pertincni part: 
ilhi/l(t. ~~f',~i.~i.:.(ii~~.iiv~? cn~,vlnj~ei. rc, !v~?!: !4ngc A~lji petifior, ti!c.d by iir hr- ;~n r'inploy~~t'ilt- 
based imntiganl t~hich ri.qirir.es an oKc?r of cmployr:;e.nt must I?. sccon~panicxi by evide~xcc 
that ihc prc>spec:tit-c ijiiiied S~stcs enlp!oyer bas the abiIitj; to pay the p~-ocfc.l-ed \><age. '!'he 
ilciiiionet- n:.ust den~oss'irai:: this abi'iit;; at ti~e iil~3~ the pri~rit:~, cfaic is established at::J 
/.. 
co-nt~nuins ~mld the hc~~:i~zi::ry obtains iai7;t'd perma~er!t i-esidenct.. Eu!c!er~ce of this ability 
shall be in lf~c forxn of cc~pies of' annua! repjrts, fsdei-a1 ta- n ~etizn~s. . or- a~dited finar:cial 
siaiements. 
'T'he pct;tioi:er- must ifr.mon::trate the cor;rir:!:ir~g ah tity ?(to pay the pro,ciei.ed wage beginning crn ~kie prior'iy 
dale. which is the date ti-tc F~rxi l3'T:I '750 Applicatior~ fbr Alien Empio:inrelif E_'ertlfic;itjon, tvas accepted fbr 
yr-ozessiiig by any oxice wi~hir: the t:~-np!~ymerit systen-r i?i' tlie U.S. Depzrtment Of l..abor. ,Yci. 8 C'FR 
$ ZCi3.5(cij. 'The pi'riiioner [nust also den~mstrdte :fiat, on the priority ilate, the ber?eric~aiy bad 1711s ciuaiiiii:atic.~ls 
stared 013 its Ful-~n E'T'A 759 Appticatiun 51r Alien EErnyli?)iment Cei-tificai~on as ce~-tiijrci by t71e 1J.S. %depaj-fme:it 
of' I,ahor and srrbmittllci :*.itkt the i!:st;int petiticsii. M:rrter ry.' F?'ifig!s E:cz !fot{sc? 16 1k.N Dec. 158 (Act. Keg. 
C'on!ni. 1Ca77j. 
Were, the Form ETA 359 was accepted cris Aprii 24. 2001. 'T'he pr-c,fi->red wage a:: .; ,ta:cd +, OR the Fomm E'I'A 
7i0 is $;S.OCI per hour ($3!,200 per year). 'T'l~e Fom~ E'I'A 750 skter; ii~at thc positicjfi requires IU~O (2) yea1.s 
of er<ptxrieni:c: 13 the job offered. On the yer~tior:, the petitivnrr ~1sis11t.d to have been es'rablishtd in 1 O?G, to 
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have a ~TOSY anmiai Income of $1,235,425, and to currently enzpioy twcr (2) uu,orkei.s. Or, the Form El-f?s 
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A .%'he ,,,l~~nission <,. a of sddi'rionai evidence on appcai is allosved by the irsstrilctions :o the Forn-t 1-2?OB, which 
arc. incorporated into the regiiittions hy the regulation at 8 C.F.R.. ,$ il:j3.2(a)il). The recol-i.i in the insrant crpse 
proscjdes no reason to preclude cor?sidr.ratioti of ony of the dociintents nenrlp submitted on appeal. SC:: .i\ik~i~fi. 
qf>Siii.iano, I0 f&N Dec, 764 (HBA 1988). 'T'itc )LAO wi!i firs: evalmie the decisio!~ of ihe dlrectcsr, based on the 
e\iidcnce siihlnitied prior io tile director's decision. 'The evidence s~ihmitted iiir t1:e firs: tilt. or: ;ippraj w~ll the11 
be considered. 
75M3, slgncd by thi: bc-nilficrary on April 17, 2003, the heneiiciary d:d riot c:alm to have svot-ked for thc 
pet~t~ona . 
With the pe~itmn, the petit;c?rrer submiilecl its Frslm 112ij, 1J.S. Cor;3imtion hcon-ie Tax Rct~m, ibr 2001 and 
2002 pei-fi;ierrt ti? iiit' ability lo pay the profi-ered wage. On Sme 107 2004. because the director deemed fbe 
evidence submitted il?sullkienl to dei-nonsnate the I.::-'+ 1 Ii,icmer7s cor~ti~uing ability to pay ~le i~roffrrctd wage 
bi.ginnl.i;g 01; the prioi-try date, the director requested adclitional evidence (RFE). Ii: accorciance with 8 C.F.R. 
5 2C.4.5(gj(3), the director specifically requested that the petitioner prnvide additional ev;~?e~ice to cstabIisls 
I!-;at the petitioner. Izad the ability tc:r pay e!:e proffered wage or sa1al-y of the benelicial-y as of l%prii 24, 2001, 
the date oi' filing and conii~sinng to ;lie presel-tf. l.1~ direcior also specif'ieaily requested col~ies of the 
brneiiciary's F'urn?. 517-2 Wage and '%'ax Starrrrjr.nts shoia;ing how much the bet?.elicia:-y was pard b\i the 
pefitioncr iF the beneficiary was emp!oyecS in ZUi,l 3rd 2Oii2. iin rrsponse, the petitianer s:lhmit:ed its Form 
i 120, 1j.S. C:''oaorarii7n jr~cnme 'r'::~ Rzttlnl. ti:r.200'.:. 
The ci!rei:tor de::ied the petition on Jar:uary 13, 2005, fi::d~ng itlai the evidexe subn-itiecl with the pettlior, and 
;r; i.esponse :u the RE did no1 establish that thr' peti!ioi:el- had the continrr!l:g aI?i!ity to pay the pruffere~t 
ivagt: beginning on the priority date. 
On appeai. co~rnsel :;uhn-;its stater!.c~-tts of ~ltr' ~r.ti?io~:cr"~ . . . Actir;e Assets IZCCCPL~~I~, anse-fided jncor,-te tax return, 
c' 
,~r. 2003. a irtlcr froxz :he petilioncr's account:~ni &i?.d the beneficiar?;'~ J '- 31'-2. hm.1 f<:>r- %O!jil-. Coun::el ;issert.s 
rhesc documents :Ic.rnon:;trnte that ;he pei!txwsl- had sufGcrent nei ixrorne or net cr.!rrenT assets lo pay r'ltrlc 
Prop:,v i~<tc , i'v'aky :.I-I 2001 throtiilz I~C prest:.nt. 
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In dztennirting the jic!~;lonei.'s al~ility to pa).: the yroftrcd wagtz duri~~g 3 given perioil, (.'itizcnship and 
Imnligratji>i: Services {CIS) .ih:~Ii iirsc i.:carninc /u.heti:er tke jrc~itroner t:lnpioycd 3rd p3iJ the hznei'iciary 
c.l\rrirlrr, pcni\d, Tf the pelitionel- establishes by di?c.;i?:xntar)i evid~:nct. that it t:rnylo::cd the beneficiary at a 
sal:q equal is> or greater that1 ihe yrofkred i~ag~? the evidence nil: be considrrc.d p!-ima facie proof ~f' the 
pcfitionei-':: ;ibiiity to pay Ilie proffered ivAgi.. In thc insrani case. Gtrlc petitionel- suis!l;itted the henef'icia~y's W- 
2 foml ;.-,- ,. 20. 'S'he beneficiary's 2004 W-2 hrm shou,js thai the petitioner en~pioyeci itrid paid the 
bel?ciicial-y $30.660 in 2003; .wlilch 
 $600 less than the prt3fTered %.age, Efo~;.. . c 5 ,- ~r, evtt~r if the petitioner 
paid &hi. Ir;cnej:ciary ai the level of the pr-ofi::reii wage irl 2804, the petiticx~er ;s st!!; obljgatcd to den-tonstrate 
tisar ii corlid pay il~e proCfer:td wage for 22110 J tki)~gh 20ij.3. 
li'ti-ie petitloner does no; establish thal it. ernpjoyed and p21d ihe beneficiary ;XI arr?r:>unt at {east equa! to the 
proffered :v;.ge cl~li-ing ~i-tar period, CllS wii4 next exame>-;e the net incorne figure reflected (131 the petitioner's 
federal ilzculne ;ax return. ~;ith~:it crjrrs.iderzitio~-t of depreciatic?i~ or (~ther expenses. Reliance on kderal 
income t;ix rerurns 35 a basis for deter-rnjnirig a petitioner's ability to pay the pri>i!~l-ed v;a.ge is well 
established by jrrdiclal precedent. k2afo.s RL~,S:G~<~[?J?~  COY^. I;. S:IIYZ. 632 F. Supp. 1049, 1854 {S.D.N.Y. 1986) 
(cifing ~:~.I~XLI{~Y/~U W<:ad~$qfi fi~mzii, f.id. I.. <i';d~~i~?:, 736 F.2d 1 305 (9th Cir. 1984 )); see (:L';ci Clhi-Fe.vg 
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C'hang il. (Iror-rrh:ri.g/?. 719 F'. Supp. 532 (N.D, 'Texas 1989): K..C'.P. Fooii Co., Iric. v. Sh:u. 623 F. Supp. 1080 
(S.D.N.Y. 1985): libtaiir I;. Pa!rn~j.., 539 F. Supp. 647 (N,D. 111. 1982), gfl'ii, 703 F.2d 571 (7th Cir. 1983). 
Reliance or: the petikiol-rer's grcss receipts with depreciatior~ is nlisplaccd. Showing chat the petitioner's goss 
recei;~ts exceeded the proIlel-ed wzge is insufficient. Similarly, shoivil-tg that the petitioner pad wages in 
excess ofthe proffered wage is instifficient. 
Irx ;";:C.P i;i?aa' C'o.. kt.. v. S'~iva, 623 F. Syp- 3'1 1084, 111.e court held d~ai the Imn~rgr;~tion arld N;itu:ralizalii>3-t 
Se~vice, no\.v CIS, !lad pi-operiy relied on the petitiona-'s r:ct income figwe, as stated on the yetjticsner's 
csrpoi.atc irlcon~e tax retrms, rather thar; the petitione-r's gross income. 'The court specifically r~jeeteci the 
argument that ihr Ser-vice should have col-rsidrred income before expenses were paid rather than nel income. 
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B he cviul in riji-.F;:r;g Ckang furdser noted: 
.Plain?iffs also coiltend the clepreciat;c?r~ aincbunts on t!:e !. 9% and 1986 returns are nsn-cash 
deductictns. Plainti2'j thus request ihat the court .sritr .sporrir add back to net cash the 
depreciation expense charge4 for tbc year. 1'iaintiffs c'te no legal a.uihori:y for this 
prnposiiioi;. 'T'his argurnezr has like~vise been presented before and rcjecled. See .Elat-o.s, 632 
F. Supp. at !O%, [CIS] and j~rcticial precedent sripport the use of tax rctu~x;: and thr net 
i/ici:rn~ ,(z?trc~ in deiel-rnining pet~tisi~er's ability :,vo pay. Plai~tills' argument thai these 
figures sho~.ild hs revised by the cow-& by adding hack depreciation is WIC~IOLL~ SL\;~POI.~.. 
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1 he record of'~roceedinp COI,~~~I~T~S the peiitioner's Fori 1120, r.i.S. c'or;3c.rrat;oi? Hnccxne Tax Retnrrl. for 2001 
thro~igil .?Oi')3. 'Thc t:ix retu~~is demonstmte the fidlowing finar;c;al iilfoimatio:~ cnnccrnjng :he petir~or~e~-'s 
abillry to pay the prisf'fererrl itiiige beginning on the p-rirjriiy date. 
In 1001. the Fomi 1120 stated nrt inci~me- of Si5,i53) 
:!()0_7. tj:r' Fc~rm 1 i 21) siatr:d :let i:icon?c of $60,798. 
Iil 200-3, ihe Form 1 1 10 stated net inconie of S i 0.498. 
'I'herefore. for the Fays 2007 ;ind 2003, rbt: peti?i:,ner rild n0: J?ZIVC SU~~~C~~RI: nei income tci pay tl:e prcrt'fcrt.ii 
;vase <,fr $3 1,296 v,;hiir ~IIC petjticjner )!:ad suffiilficirnt !?ct i!;co~ne to pay th? 1:rioEe:r.t-6if wage is 21102. 
lf the net ineon.~r the periticsr~er dert~a~~s~ratt.s it !:ad a:;ail&lc itsrir::: .[ha: jseriod, ii" any, ;iilded to the u,fage:: 
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paid :.o ihe ber-e-i-lc!ary c.iuri~?g thr: pertna, li- any, ,SO nut equal the an?our:t of il~e proiTereil wage or. ri-tore, CIS 
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wiil iciriew tl~e pet~rior:.cj-'s asscts. I lie yetiilaircr's t:t~aI zssets iwlude del?recia;,lt. assets hiit the pe!~lri:rne~ 
:ise:s in iis buslncss. 'Fllosc. deprccinbie asscts :*.iii nut bc cor!veriei! to cash du:-~ng tht: ordinary course of 
irri.isines:; ar14 
 not, itlereli,r.e, becon~e 1t"lmds ;wailable lo pay the proi'fered wage. I;~.irther. the pittiticincs's 
total assets must be halmced by the peti~iuner's liabilities. dltherwise. they canfiot properly be corjsidered it, 
the ~!etermir~a.~iort of the penlioner's ability to jwg; the psoffercd wage. tPnther, CIS will consider net current 
assets as an alrei-native method of'denrozslrat:ng thc nhility to pay the prc~fh-ed wage. 
Net current assets are :be dif1-Prei~ce bctwer-i: it~e peti~ioner's current assets and current liabiii~ics.' 
 A 
ctxporaficsn's year-end current. ;it:sets are c'- ..,~U,LJI . .- . 011 Schedule t. lines I through 0. 
 bs year-.en<: cutrent 
liabilities arc shov~n on kizs ',6 though 18. If ibe lo~d of a corporation's encl-of-year net curent assets and 
the i.:;,ges pald io ihe bene-i-iciar): {if any) are eqrral to or greater than t2:e profkreii wage. the petitjoirer is 
,k.Zicci wage using I;rlose net curent assets. Tfle peiitionzr's 2001 tax retuin 
expected. to bc: able ro yay the pr-?.. - .- 
shows that tIie petitioner. had currerrt assets oi' SY.834 and ci~~rent l~abii-ities of $; 8,734, and tIlijs its nei 
ciii-r-c.~~t assets in 2001 were $(X,S98): tile petit-loner's unarncnded 2003 tax retu~n shoti~s thai the petitioner had 
c,urrcr:t assets of $58,844 ;!nd current liabiljtjcs oi' $5 1.294, and tkiis the petitioner's net currcrrlt assets in 2603 
, r. 
I axatrre income bsibre net opeiatmg loss cleciuctiisii and special deduc~ions as reported on Line 28. 
' Acc~rding tu .Bi!rror~ >i. iiiccionar?,: ~!f'~ilr.ccurntirsg i(i:~nu 1 17 (3'" ecrl, 2ij001, "ctln-o?t assets" co~zsist of itzrns 
having {in r::ost cases) a Irfe of one year or less: such as cash, marketable securities, inventory 3rd prepaid 
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expenses. 
 C.:irrenc ilalsrfities" are ohligations payable (in inost caszs) wit1ri1-t one year., sich accounts 
payable, sho~-f-iem noies payable. and accl-ued expenses (such as taxes arrd saiaries'). Id. at I 18. 
were $7,550-'. T'r~creii)rc, the peritioner had ins;rffic^icierrt net cu~rerit assets 10 pay the beneficiary the profi'c~ed 
wage in 2001. or 2003. 
Coimsei asserts on ap1:eal ihaf there is another way to determil-re !'he pi'titin~er's ability to pay the proffered 
$.;age horn the priority date. Counsel submits iile s!axe,nc:lts fix the peiit.iorra-'s active assets account hr 
20iS1 through 200.3. Counsel's rel!znce cm the balance iz t.h< petitioner's active assets accoit~:f is n~isplace<l. 
Pitst. assets xccrtmt sBiemenls are noi x~~iong t!?e ii~ri? type?; of evidrnre, enutlzerated in 8 C.F.R. $20li.";g)(2), 
required to ?Iiustr:rzte a ptrtitioiner's ability to pay a ~roflered wage. JTl-rile tlnis ~.t"g~~liili~i? allrs~vs additional 
materiai "irs zppropl-jate cases,- thil petiiic~ner in tl-ris case his 1x01. dm-ronsbted i%rh;v. the documentaiion specified 
at P C.F.K. 5 26i3.5(g)62) is inappiicahle GI- othel~iisr paints an i~acci~mte financia! pictiisit of the petitioner. 
Second? assets accoril~t statenlci:ts show tl-re anlourit ii-t an accc?ur:t. orr a giv~n date, and cannot show the 
~t~stairiable 3bi;il-y trr pay a proEereil wage. Third, no evidel-tce was subnzi:=*,<d to de:nonsrrate that he fimds 
repo;?:eil ijn lhc petitio~-rei.'i assets acco~nt staterne~nfs scsmehoi~; reflect additional available fi-inds that were not 
rci1n;:ed r}n ih :ax rt-turn, sir& as the petitior~er's ramble i~~corrte (ilzc:otnc. n:inus deduciionl;) or t11c cash specified 
Scheduie 1- that 
 cr.ozsidercd in deter-ruining the periiioner's net i:n?n-en: assets. 
C)n appeal ccjrinsci atso subnits a letter ficjnr ciie pc;:iit;c~ner's accouniant 2nd cot?tei:ds ttmt the ;ettxer explains 
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the petitioner bad s:ii'iicient i~:camc ail<$ resowces to p;:y ihz proikel-ed wage. Ihe accountant letter ststes in 
perilnest ydrt: 
< '. 
.I'lne tax reiuni sttowed 3 net 10s:: cif SS,15.5. j-Io~e\,c~-, the ;j~ziiuiine?.j did not cxpcrience a 
net ioss $3~ rhA year o1-r 371 ~?CCIZIZI basic. 
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I.'cI~. :yi)iir kill6 ~ni'mniatioi:. Qrc [petirionerj files lax refiu~~s 013 3 cash 9x1:;. 
 i'heii- 2001 
[)eceinber re.;eniie of' J3<>.i'3(, v;as rc;.eiv;:d on Qi-.0>-fi2 2nd de?i~siled ;n 20Cj2. 
Accordingly, the [;?ctltio::er] nas yr.of?tc\blc for t'tie year 2001 by $33,971. 
Sjnnilarly thil accottntant assefis that eiie peritior~er- ha3 an actual prof r oi' $.-14,!05 for 2002 and $ i 6,562 fcir 200.; 
despite it:: rcrpcirted net, income. '{'he accourrtant ietter i,s tryirrg L<j establish tile petitioner's ability to pay the 
pr.offercd wage through an analysis using nn accrual accounrjng ;nethod for the peritioner's tax retui'tls. ?"he 
petitioner's tzx retunls were prepawd pustranl to cssh zoncCentiorzl in M"II~c~ rciienue is recognized whci: it is 
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received. ax! expenses arc recsgi:ized wvken they are paid. 'Th~s ctfike ivotiit;, in the alternative, Irave accepied tax 
rt'tl1rfls prepared p1lrsiiant to accrmj convcntio-n, if those ivere ihe rax. retunis tile petitior~er had actilrtlly subnn~tted 
to TRS. 
'This . . rsf~ice is not, Izu\~:eues, persuaded by a;~ an31j,sis ir, t>,rhich tl-re petitioner, or anyme on its behafi: seeks tc) 
rely on rettui:s or tinarlcikil siatemmnts prepared pursi1ar:t to one rnctlnod, but :hen seeks to shi3 revenite or 
expenses fi-on? ot~e year ti? anotiler as cnr;vi.nien:nr 
 the petitioner's preser:t purpuse. 
 If revenues are not 
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C'ounsrj :;ubn:ii:; d~e petitioner-'s anleilcfed tax reti~ix 
 2003 on appeal and explains tinat a prior accountant 
c.rrr.>neousiy prepared tlre first one by applyir-tg an ii~correct aceouriring methodology. 't'he amet~d.ed tax rcturn 
does rloi change the net jnconx reflected cxz !inr 28 but the petitioner's ilel ctrrwttrd asscts were changed from 
$7,550 to $(29,934). FIo\~ever. the copy of the arnended tax retiinn slibmitted on appeaf does not hear any 
signahire fiorr: the pctitiozcr's legal representatwe, nor does it co!itail-t any IRS filing stanps. 'I'herefore, the 
A40 will use the f'ikyire from the iirsiial tax return instead of the an~ended in dcterrr:inirig the petitioner's 
ability to pay. 
r.t?cog-ni;:ed 12 a giver? ;:ear pursuant to Ihe cash ;iccc?unting then the petitioner, whose tases are prepar.:d 
pursuai~t to cash rdther than acc~.ua!, and 1v30 re'iies 011 its tdx 1-et1'nrns In cxder to show its ability lo pay the 
pl-wfr'ered wzge. may not rlsc those revenues ;is evidence of its ai>jljty to pay the gi-offerzd wage during that 
year. Sinrilarly, if espe:>ses are recog~-r,i~ed in a givra year, tk; peticiotzer may i-rot shilt ttI:osc expenses to 
some other :);ear 113 an c'fiiort to show it:; ability lo pay the proffered ;.t,age pusssayit to some I-cyhrid of accrual 
, 
and cnsh accounting. 
 I he arrrounts shoixii~ on thr petitionerv:< tax returns sha'll be considered as they were 
sub~niited to IRS, not as amended pursuan: to tl?e accounta~zt's ad-iustrl~ents. If the accoiintant ~~isl-red to 
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persuade this off-icc t1:lmat acor~ral accounting suppoi-ts rj:~e petjtrulzers continuing ability to pay tltc proffered 
wdgr beginning on the griurity date, then the acci,u-ntaint was obliged to peparc and siibr?~!t audited financial 
stamnents pcriinent LO tile petitio~ing business prepared accnrding tn generally accepted accounting 
principles. 
In ~Zle presc;it nyattcr, thr peiitic~ncr has iJenitGed itseif on 7% Form 1 120 as 3 "personal serv;ce i:itrp?iili-a~ic:ri-r.'; 
I':i~.su;?lz t 10 .It[~ir!.:'. i?fS~iti~'gti~.~, 1 7 I& N Lkc . 6 i 2 (8 If2 1 :?G7 ), the pciitionrr 's '*personal scrvice corporation" 
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status is a icievanl fa~:for. w be cc:;isid;.:i.d in detenxining its abr11t;y ro pay. A '-personal se;-vice co~osatli.rn" is 
a corporation .Y,/ here the "er11.p l~;ie~-o\,vr;~rs" are e:~gagcti in the per5xnance of pcrst~nai services. The 
' 9. 
hrenra! Revenr~e C'odr. {[Rciiil) define:: "persona! servlct.:; a:: serviccs perfon-ned in thc fieltfs, of health, jaw, 
c~igilleering, arcl?itecture, LICCOW?~;!~~, sch~arictl science, performing am, and co~?siiiting. 26 1j.S.C. 
g 448{6)(3). As :: corpc?ration, the jrre~~m;zl ser\;ice cr~rpomtion filcs an If<S Fuxn I i2Cj and pays ~rix on its 
profits as ;i ci>rpos;!tc entity. I-!t>w~\~er, uniler thc 1KC, z qu~iif;cd personal service cnrpnrrrtii:~n is not aiJaw;ed 
. . 
tti lise the graduafed tax rates tbr ather C'-co~~r.atiorl~, Fr:ste;!d, (lie flal tax rat.e is thc highest ntarglixi r;ltt2, 
which 1s cuweritly 35 percent. 26 1.i.S.C. 5 I lib)(2). Secausc of the high 35% &lat tax on the i:r>rf~oraiio1-t.s 
t~:<able !nc;o.t'lne. gersonal st?nict, cor)loralicjns ~;.nc?tally ily io cistribrlie ;II; profils in the fi~rnm of wagcz to the 
crnp~o:~~tre-shari'b~~idzr::. In turn, d-te cmj>!uytre-skareh~31ders j32y persc~nal taxes on thcix wages and tbcrcby 
avoid dosbic iasaiii:r!i. 'I'his in cF'i.>ct car? reduce the ncgarlve !n:pact of' the f73t 35% tax I-aie. Upon 
cc:tiisideration, bcciiuse the lax ci>d:: hoids pel-sonzl ser.v.icc corp<)~xt;~~~~s to ihi: highest coryoratc t:i:u rate to 
ciicouragc the dis~r'iitiitior! of' corpordte rncolne to tile rn-rgloyee-owners an(;;; b. ,c'cat!::e tiie o~vrlel-s ba;:c. the 
. . 
'texibility to ddjljust tbex incnme oij an annsai basis, the hACl uill recog-n-niz;:-. the pet.~t;oncr's i>ersonal service 
.. . 
zorporaricm status as a relevant factor to be considered in cieiel-;nm:i:g its abiilliy to pa;:. 
. . 
As in ihr: present case. sul~stantial!:~~ nl! ofthe stock of a personal service corporatrcn xs held by its cn-rpioyees. 
reriretl ~tz.rpli:tyees. or. their estates. 'The do~~in~entation prehented here jndicares that Moharni~iad Wayeern (Dr 
xa. yibn,) ,-. j~olds 100 perceyit oC the company's stock and perhrms the personal services of the denta! practlcc. 
According to thi' ~rie;itic>ner's 2iIilZ 18-S Forn: 1 120 Schedule E !,Con~pt.nsa~ii: of Officers), Dr. Nayeern 
elected to pny i-timself $80,000. According 10 the Schedule E 1-hr 2002 3rd 17003, he paid himseIf $200?000 
and $7 1,492 respectli'elj;. Wc note here that the cumpensaticsn received .by the co~-~pany's owncr clilri~lg these 
three years was not a fi.xed salnry and amomled :I:, avcrrtgcr r;lol-e than $j Cj0.000 per ycar. 
CIS (ieeacy INS) has long held illat it may nisi "p~erc~ the corporate veii" aild hok io the assets ctf the 
corporaiictn's owner to satisfy the co;poratioii':: ability to pay rhrt proffered wage. It is an elen?enta~y i.nle that 
a corpor~tior! is a sepalate and disiincl- legal eniity from its owners and sharei~ulc!ers. ,.ce A4irtfer (3fiili, 8 E&N 
Dec. 24 {BIA 1(358), ~t/Lglft:r c,f.4phrati!rs In~i?s~nir??lf~c, Lid. j'? T&X "I;:% 530 (C'ot~~m. I98O), 3rd i%!uif~r r$ 
fi:si.el, i? i&N Dec. 631 (Act. Assoc, Corrmm. 19SO). Consequently, assets of it3 shar.d-zo2ders or of  oil^;. 
rnterprlses or coq?or.dtions cannut be cunsidcrcid in detemlining the petitiozing i'orporatio~z's abiliqg $0 pay the 
proffered wage, 
In the present case. howeil-el-, CIS would not be examining the personal assets of'tl-re petiiioiiefs owners, bur, 
rati-~er, ihe flnanclal flexibility that ihe ernj~joyee-wxmer. has in setting 111s salnry based oil the profitability of 
h~s persunai service covt>ratiun denta! practice. Thr tax rcirtn~s f~r tiiis perii~td show nrt: only thaf the 
pet~jioi~a- exercises a iarge degree of 5nancial flex!hiliw in setti~lg employee salaries: but that the petitioner 
fi~ifills its sa1.3~y obligations. Clearly, the yetit;oning ei-ttity is a profitable enterprise t;,r Dr. Nayeenr. As 
prci.i~iisi~ nofed. the dental practice earned a goss lxoiit. of $307.545 5in 2001. and 5352.415 in 2003. '171e 
arnor.mi paid to the Owjig: is deter:xii:ed by the profi"it;rbiii:y ol t.I:e corpc>satic?n. None c?i these ~-run:bers 
represer~t fixed. expenses. h I-evieiv <?ithe pet-iiio:.~@r's gross proiit'lt and tlie a!nuunt of con~pc!'sation paid out lo 
the ernp1oyc.e-owner cc?!~firms that the job ot'fe~ is realis1.i~ as:d illat the i:rroff'red saialy ol$3 i.200 can be paid 
by .the pittiiirjnc-r. 
,, .>'cami-.; ,I,!,, ,.I a . petitioner's abiilry to pay the profl'il-ed warre, the f~:ndan-ieniiiI focus ofti-,e (11%' deterruination 
. . 
is w+et!- .r<i . ; :be employer is nraking a reafrslic job oltrr and has the uvcral! financial a7cjlit;l to satisfy the 
proffered wage. i'viur'le~ c$'G.~t.iif RZtli. I6 i&N kc. i41. 145 (Acting Reg. Comm. 1977). Accc>rdii~gly- afirr 
.j revieiv of the petitioner's f~:;tde:.ai tax retui-r,s and aii o:hcr reievarit evidence, ih:e ~i3i1~1~de .'l~at thr petitioner 
has r.c;tabli::lied ti-~ar i': hacI the abiliiy lo pay iht' salary offered as ~>i' ibe prici~i~y date ;.i!i' tile petjtion xlif 
cor~tjntdr.g !o present. 
,-.. 
i!ie eyjdenccr: subn:![ted c.stah{i:;hcs thnr the pt'titiorier had die contiiiuifig ability to pay the proffered wngc 
I-it.ei312ing c;-. ir;~ the priorit:; date. 
. . 
 . . 
'l'jzc b~vdcr! of p:.-oof in t!;ese procc:e~iings r.est:j solzlj~ wiih t!-:r' pc't?i:or:er. Section 2'4 1 ~f the Act, S IJ.S.C. 
6 1361. ?'he pc!liio!:er has I~C? tliat burden. 
. . 
ORDER: 'The al:rpi'ai I:; sustained and thc peiltiori is ap!,rcvcd.