When an employer sponsors a worker for a green card through PERM, the I-140 must show more than a job offer. "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" (8 CFR 204.5(g)(2), 2025 edition).
As of October 26, 2026, the USCIS Policy Manual sets out how officers test this. This guide explains the evidence and the calculations, which matter most for small and growing companies.
- The employer must show ability to pay the offered wage from the priority date until the worker gets permanent residence.
- Required evidence is annual reports, federal tax returns or audited financial statements for each available year from the priority date.
- Employers with 100 or more workers may submit a financial officer's statement instead.
- Paying the worker at least the offered wage each year can establish ability to pay for those years.
- Otherwise, net income or net current assets equal to the wage, or the shortfall, generally establishes it; the two are not added together.
- USCIS may also weigh the whole business, such as revenue, history, growth and reputation, when one year falls short.
What evidence is required?
One of three document types for each year, or a statement for large employers. "The petition must include copies of the petitioner's annual reports, federal tax returns, or audited financial statements for each available year from the priority date," and "if a U.S. employer employs 100 or more workers, it may instead include a financial officer statement" (USCIS Policy Manual, Vol. 6, Part E, Ch. 4).
| Evidence | Key point from the Policy Manual |
|---|---|
| Annual reports | A Form 10-K or shareholder report qualifies; private company reports are most persuasive with audited data |
| Federal tax returns | Should be complete with all schedules; USCIS may ask for IRS transcripts |
| Audited financial statements | Must be audited, with an auditor's report; compiled or reviewed statements alone are not enough |
| Financial officer statement | Only for employers with 100 or more workers; detailed letters are most probative |
The manual adds a warning: "The mere submission of annual reports, federal tax returns, or audited financial statements does not establish ability to pay. USCIS must analyze the financial information contained in these documents" (same).
When might a financial officer statement not be enough?
The Policy Manual lists examples, including when the employer "has filed petitions on behalf of multiple beneficiaries to the extent that the ability to pay all of the salary obligations may be in question," when the record suggests fewer than 100 employees, when the letter is old and reused, when it conflicts with evidence such as "large losses or the petitioner is in bankruptcy proceedings," or when it does not show the signer is a financial officer (USCIS Policy Manual, Vol. 6, Part E, Ch. 4).
How does USCIS test ability to pay?
In steps.
1. Wages already paid to the worker. "If the petitioner establishes by documentary evidence that it has paid the beneficiary a salary equal to or greater than the proffered wage for each year from the priority date, the evidence may establish the petitioner's ability to pay," usually shown with W-2s, 1099s or state wage reports (USCIS Policy Manual, Vol. 6, Part E, Ch. 4). Benefits such as health insurance premiums do not count as wages.
2. Net income. "Where the petitioner's net income over the relevant period is equal to or exceeds the proffered wage, the petitioner generally demonstrates its ability to pay that wage." USCIS "does not add back depreciation" (same).
3. Net current assets. Current assets minus current liabilities. If they equal or exceed the wage, ability to pay is generally shown. USCIS "does not add net income to net current assets," because one measures a period and the other a moment in time (same).
If the employer paid the worker something but less than the offered wage, it "need only demonstrate that its net income or net current assets are equal to or greater than the difference between the proffered wage and the actual wage paid." The manual's example: a $50,000 offered wage with $40,000 paid needs $10,000 of net income or net current assets for that year (same).
What if a year falls short?
USCIS can look at the whole business. The manual says "the ability to pay analysis is more nuanced than simply reviewing wages paid, net income, and net current assets," and lists factors such as gross sales and revenues, total wages paid to current employees, media accounts about the business, years in business, historical growth, recent disruptions, number of employees, uncharacteristic losses from which the company recovered, and "the petitioner's overall reputation within its industry" (USCIS Policy Manual, Vol. 6, Part E, Ch. 4).
It gives two examples: "when a petitioner has one unprofitable year despite a history of profitability," and when "the beneficiary is replacing a former employee or outsourced service or that an officer of the petitioning employer is willing and able to forego compensation specifically to cover the wage" (same). A company deliberately running at a loss, for example for research and development, should "fully explain the sources of funding for the entity... and the expected profit potential."
Can the owners' money count?
Usually not for corporations and LLCs. "Generally, USCIS does not consider the financial resources of persons or entities that have no explicit legal obligation to pay the proffered wage, including a parent company, shareholders and officers of a corporation, members or managers of a limited liability company (LLC)... and limited partners" (USCIS Policy Manual, Vol. 6, Part E, Ch. 4). Sole proprietors are different: there is no separate entity, so USCIS looks at the owner's adjusted gross income minus personal expenses, and personal liquid assets. General partners can also be considered because they are personally liable.
Bank statements and lines of credit can support the picture but have limits: bank balances may already be counted in net current assets, and credit is "one piece of evidence" within the overall financial position (same).
What about the first year and multiple workers?
The priority date year. The employer "may request that the proffered wage be prorated for the applicable portion of the priority date year," but USCIS will not count 12 months of net income against part of a year, and it "does not prorate net current assets" (USCIS Policy Manual, Vol. 6, Part E, Ch. 4).
Several I-140s. An employer with many pending petitions may face questions about paying all of them, though this "may not be necessary if the petitioner has paid the beneficiary of the petition a salary equal to or greater than the proffered wage since the priority date" (same).
Our guides to the PERM process and what happens after I-140 approval cover the surrounding steps, and our guide to AC21 job portability explains changing jobs later.
What this means for you
- Workers: keep every W-2 from the sponsoring employer, since wages paid are the simplest proof.
- Employers: check net income and net current assets on each year's tax return against the offered wage.
- Do not count on a parent company or owner's personal funds unless the structure allows it.
- If a year shows a loss, prepare an explanation and evidence of the business's overall strength.
- Employers filing many I-140s should track their total wage obligations.
Where to start
If you want a green card route that does not depend on an employer's finances, our free evaluation at /evaluate/ maps your record against the EB-1A and EB-2 NIW standards, and Frank, our AI assistant at /frank, finds real opportunities to strengthen it. Petitions are reviewed and filed by our partner law firm, Lai & Turner.
Sources
All checked October 26, 2026.
- 8 CFR 204.5(g)(2) (govinfo, 2025 edition). Ability to pay requirement and evidence.
- USCIS Policy Manual, Volume 6, Part E, Chapter 4, Ability to Pay. Required evidence; financial officer statements; wages paid; net income; net current assets; totality of circumstances; owners and parents; proration; multiple beneficiaries.
Frequently asked questions
What is ability to pay on an I-140?
It is the employer's obligation to show it can pay the proffered wage on the labor certification. The regulation requires that the petitioner demonstrate this ability at the time the priority date is established and continuing until the beneficiary obtains lawful permanent residence, using annual reports, federal tax returns or audited financial statements, or a financial officer statement for employers with 100 or more workers.
My employer already pays me more than the PERM wage. Is that enough?
It can establish ability to pay for those years. The Policy Manual says that if the petitioner shows it paid the beneficiary a salary equal to or greater than the proffered wage for each year from the priority date, that may establish ability to pay, usually shown with W-2 forms. But the petition must still include the required tax returns, annual reports or audited statements, or a financial officer statement.
How does USCIS calculate ability to pay for a small company?
It looks at whether net income or net current assets, usually taken from the federal tax return, equal or exceed the proffered wage, or the difference between the wage and what the company already paid the worker. USCIS does not add back depreciation and does not add net income to net current assets. If both fall short, it may look at the whole business.
Can a parent company's finances show ability to pay?
Generally not. The Policy Manual says USCIS generally does not consider the resources of persons or entities with no explicit legal obligation to pay the wage, including a parent company, shareholders, officers and LLC members. A parent's annual report is more useful when the subsidiary's own financial data is shown separately within it.
Does ability to pay matter after I port under AC21?
Ability to pay is an obligation of the employer that filed the I-140, and the regulation frames it as running from the priority date until permanent residence. If you later port to a new job under AC21, the main question for the new job is whether it is in the same or a similar occupation. Keep copies of your W-2s from the sponsoring employer in case questions about earlier years arise.
Green Card Guide AI is not a law firm and this article is not legal advice. It describes evidence-building strategy in general terms; your attorney determines what belongs in your petition and how it's argued.
