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Q: Starting a home based business - Is this legal for us? ( Answered,   2 Comments )
Subject: Starting a home based business - Is this legal for us?
Category: Miscellaneous
Asked by: adi0523-ga
List Price: $50.00
Posted: 21 Nov 2002 08:59 PST
Expires: 21 Dec 2002 08:59 PST
Question ID: 111986
I am on H1 B visa maintaining valide non-immigrant status and my wife
on H4 Visa.  Is it valid either myself or my wife to sell products on
eBay or do some web based business like mailing etc., and earn income?
 I am seeing lot of advertisements such as "If you own a computer, put
it to work and earn some money".  Is this legal for either of us?
Subject: Re: Starting a home based business - Is this legal for us?
Answered By: cath-ga on 21 Nov 2002 13:40 PST
Dear adi0523-ga,

I’m afraid I have bad news for you. I have consulted several sources,
that you could legally do some work “on the side,”  in addition to
H-1B job. Unfortunately, you cannot and your wife cannot.

I called the U.S. Immigration and Naturalization Service Customer
Line at 1-800-375-5283, and spoke with Information Officer Wilkerson.
She told me that the H1-B visa is “employer specific” and the one
on your visa is the only employer you can work for. I asked if you
could have a home-based business and work for yourself, and she said,
“No, he can’t work for himself.”

I also e-mailed Rajiv. S. Khanna, an immigration lawyer, at

I told him about your question, informed him of the visas you and your
have, and this was his e-mail reply, “They cannot do anything on the

I had feared this would be the answer, since I also looked up the
of your visas. 

“H-1B status is only valid for employment with the employer who
petitioned the
INS and only for the particular job for which the Labor Condition
was filed.”

This is according to the MyNewJobFinder site, at:

Your wife is, of course, more severely limited than you are with the
H4 visa:

“Spouses and unmarried children (under age 21) of H-1B visa holders
H-4 status, allowing them to enter but not work in the U.S.” This
according to:
TriNet .com at:

So, the answer is, you and your wife are not allowed to work outside
specified employer of the H-1B visa. However, if you would like to get
really ambitious and form a company to employ American workers, that
is a whole other story. You might be interested in an article on U.S.
Visa News at:

The questioner asks if, as a H-1B visa holder, he can start his own
The answer states basically yes, but he can’t actually do the work,
employ others. I know this isn’t what you were asking, but you might
be interested in checking it out.

It might be tempting to go ahead and try to do web-based work anyway,
I found this related comment on a bulletin board at

“Posted by Rahul on March 20, 2000 at 01:05:21: 
KAYA on March 18, 2000 at 16:09:06:
It is certainly illegal.
Although many new H1 desis are being lured to do some side business
such as AMWAY, etc.
It is not worth the risk, especially if one wants to stay in this
country for long and obtain a green-card. INS is pretty smart in
uncovering such things at the time of green-card, and they are always
looking for any excuse to NOT give a green-card. “

Sorry for the bad news. As someone who enjoys my work over the
I wish you had the same privilege. Perhaps things will change in the
Before you rate this answer, please ask me to clarify or add anything
left out. I appreciate your business. cath-ga

Clarification of Answer by cath-ga on 21 Nov 2002 17:02 PST
I forgot to list my search terms. They were "h-1b visa home based business,"
"us immigration," "h1-b visa work at home," and "immigration law."

Clarification of Answer by cath-ga on 22 Nov 2002 10:24 PST
Here is another late response from an immigration lawyer Farhad
to explain the difference between "work" and "investing in a company."

"Having a business and working at it versus investing in a business
are two vastly different things.  Recieving the profit from an
investment is appropriate. Receiving a salary or other compensation
from a business is not appropriate.  The IRS takes the view that
regularly working for an entity (for a specific period every day,
etc.) constitutes employment.  The INS would typically follow suit,
employing the IRS definition.  If your clients set up a corporation,
perhaps paid a fee to someone to actually "run" the business, invested
in the business, and received the profit, then I can see that this
legal structure insulates your clients from direct "employment" and
thus could be permissible."


Request for Answer Clarification by adi0523-ga on 10 Nov 2003 08:22 PST
Well I need some more clarification about your anwer.  What if I do
some stuffing envelopes for some trading company and they just send
money to me through checks.  They don't hire me and they don't deduct
any taxes and they said they send Form 1099 for Tax purposes.  I can
file taxes declaring what I earned.  Is this possible within my legal

Clarification of Answer by cath-ga on 10 Nov 2003 11:54 PST

from the research I have done, the answer is "no." What you are 
describing with the envelope-stuffing is still working for someone
else. And if they send you a 1099 form, and you file taxes for
working illegally, your visa for working legally will be in great
danger. cath-ga
Subject: Re: Starting a home based business - Is this legal for us?
From: viper69-ga on 26 Jun 2004 19:47 PDT
I have a proposed solution and need to know if it will work.

1)Incorporate (register) a new company
2)Hire and pay anyone to work for that company
3)Invest in the company
4)Provide the services and earn revenues
5)The company will then pay you the profits.


2) In step 2 above.. do we have to hire a citizen, or anyone?
3) In step 2 above.. is there a minimum salary required?
4) For TAXES - How does the company report "paying-out" the profits to
the investor?
5) For TAXES - How does the investor (h-1b status) report the "return
on investment" ?  As in does it go under additional income.. or

Thank you in advance!!
Subject: Re: Starting a home based business - Is this legal for us?
From: pinkfreud-ga on 26 Jun 2004 20:05 PDT

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