sustained EB-3 Case: Restaurant

identify :etd to 
prevent cleaiiy tinwarranted 
invaioa of persod privsy 
PUBLIC COPY 
U.S. Department of Homeland Security 
20 Mass, N.W. Rm. A3000 
Wash~ngton, DC 20529 
U. S. Citizenship 
and Immigration 
late: 
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 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. 
Robert P. Wiemann, Chief 
Administrative Appeals Office 
Page 2 
DISCUSSION: The preference visa petition was denied by the Director, Texas Service Center, and is now 
before the Administrative Appeals Office on appeal. The appeal will be sustained. 
The petitioner' is a restaurant. It seeks to employ the beneficiary permanently in the United States as an cook. 
As required by statute, the petition is accompanied by a Form ETA 750, Application for Alien Employment 
Certification, approved by the 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. 
The business was established in July 2003, and according to the petition, employs 10 individuals. 
On appeal, counsel submits a brief. 
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. 5 204.5(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 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. Comrn. 1977). 
Here, the Form ETA 750 was accepted on August 5, 2003. The proffered wage as stated on the Form ETA 
750 is $21,757.00 per year. The Form ETA 750 states that the position requires two years experience. 
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; U.S. Internal 
Revenue Service Form tax returns for 2003 (a partial year's return beginning August 1, 2003 to year's end) 
and 2004; a restaurant menu; the beneficiary's personal tax return for 2004 and W-2 statement; the sales 
documents evidencing the purchase by the petitioner of the business in 2003; a commercial lease of the 
business premises; approximately 87 business checking statements; and, copies of documentation concerning 
the beneficiary's qualifications as well as other documentation. 
1 
The petitioner operates under the trade name of 
 Japanese Restaurant. 
Page 3 
The director denied the petition on January 19,2005, 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. 
On appeal, counsel asserts that since the petitioner, established in July 2003, was only operating from August 
2003, its taxable income of $16,938.00, extrapolated for 12 month period based upon its averaged monthly 
earnings are sufficient to pay the proffered wage (if it had been operating for 12 months). The unsupported 
statements of counsel on appeal or in a motion are not evidence and thus are not entitled to any evidentiary 
weight. See INS v. Phinpathya, 464 U.S. 183, 188-89 n.6 (1984); Matter of Ramirez-Sanchez, 17 I&N Dec. 
503 (BIA 1980). 
Counsel contends on appeal that depreciation, although taken as a deduction on the tax return, should be 
considered an asset and added to the taxable income of the petitioner. Counsel cites an unpublished AAO 
decision in support of his contention that, according to counsel, depreciation established the ability to pay. 
While 8 C.F.R. 103.3(c) provides that precedent decisions of CIS are binding on all its employees in the 
administration of the Act, unpublished decisions are not similarly binding. Precedent decisions must be 
designated and published in bound volumes or as interim decisions. 8 C.F.R. 103.9(a). The AAO reviews 
appeals on a de novo basis. See Dor v. INS, 891 F.2d 997, 1002 n. 9 (2d Cir. 1989). Counsel's contention will 
be discussed. Each case must be reviewed upon its own merits, and by definition, each case has its own 
particular fact situation that may result, and often does, in differing legal analysis and applicable of regulation. 
Counsel contends that the asset value of the business is evidence of the ability to pay the proffered wage. 
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. Evidence was submitted to show that the petitioner employed 
the beneficiary. In 2004 the petitioner paid the beneficiary $9,000.00. 
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 $21,757.00 per year fi-om the priority date of August 5,2003: 
Page 4 
In 2003, the Form 1120 stated taxable income2 of $16,938.00. 
In 2004, the Form 1120s stated taxable income of $25,606.00. 
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 in 2003 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 liabilitie~.~ 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 1120s 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. 
Examining the Form 1120 and 1120s U.S. Income Tax Returns submitted by the petitioner, Schedule L found 
in each of those returns indicates the following: 
In 2003, petitioner's Form 1120 return stated current assets of $8,760.00 and $2,541 .OO in 
current liabilities. Therefore, the petitioner had $6,2 19.00 in net current assets. Since the 
proffered wage is $2 1,757.00 per year, this sum is less than the proffered wage. 
In 2004, petitioner's Form 1120s return stated current assets of $21,086.00 and 
$1 1,977.00 in current liabilities. Therefore, the petitioner had $9,109.00 in net current 
assets. Since the proffered wage is $21,757.00 per year, this sum is less than the 
proffered wage. 
Therefore, for the period 2003 through 2004 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 1120S, this method would eliminate depreciation as a factor in the calculation of taxable 
income. 
IRS Form 1120, Line 28. 
3 
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. 
8 C.F.R. 3 204.5(g)(2). 
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, 7 19 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 advocates the use of the cash balance of the business account 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. ?j 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. ?j 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, or the purchase of the business included as 
an asset, 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. 
To restate, on appeal, counsel asserts that since the petitioner, established in July 2003, was only operating 
from August 2003, its taxable income of $16,938.00, extrapolated for 12 month period based upon its averaged 
monthly earnings are sufficient to pay the proffered wage (if it had been operating for 12 months). As we have 
already stated, an unsupported assertion of counsel cannot be considered probative evidence. 
However, we note that in only one year, 2003, was the petitioner's taxable income less than the proffered 
wage by $4,819.00. Since this was a partial year's earnings, a case precedent followed by the AAO states that 
the totality of the petitioner's circumstances should be considered in particular instances in which unusual and 
unique circumstances act to depress the petitioner's income. Counsel asserts that year 2003's income may be 
extrapolated to determine, if the petitioner had operated for a full year, what the total income would have 
been. We disagree. Since by counsel's own contention, the petitioner's start-up year was a unique event, it 
cannot be used as a reliable indicator. However, the next year taxable income reported was in a full year's of 
operation, and, in it, the petitioner taxable income was more than the proffered wage. In Matter of Sonegawa, 
12 I&N Dec. 612 (BIA 1967), the Regional Commissioner reviewed the petitioner's prospects to continue in 
Page 6 
business despite near term losses caused by unique and unusual circumstances. It is often cited for the 
proposition that the totality of the petitioner's circumstances be considered to determine the ability to pay the 
proffered wage. We find that a review of the totality of the evidence submitted indicates the petitioner had 
the ability to pay the proffered wage from the priority date, but for the above circumstances that under Matter 
of Sonegawa, should not be considered a disability. 
The evidence submitted does establish that the petitioner had the continuing ability to pay the proffered wage 
beginning on the priority date. 
The petitioner has 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. 
9 1361. The petitioner has met that burden. 
ORDER: The appeal is sustained.