US resident wants to open business and employ Canadian

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US resident wants to open business and employ Canadian brotherHi David, 
I really appreciate your newsletter and web site. The following is a somewhat unusual situation that may be of general interest.
I am a Canadian, permanent resident in the US who would like to purchase a business (as yet undetermined) either in the US or in Canada and have my Brother, a Canadian citizen and resident, operate it. I would be able to invest about $500,000 US in the venture.
I understand that I could suffer onerous tax consequences if the business were in Canada (while I remain in the US). Is this correct?
Could my brother use my offer of employment to him (as President) as a means to immigrate to the US? The business would not be anything highly technical or professional, probably service or real estate related. 
He is early 40's, and is in the middle of a very messy divorce so I do not want to have him in an ownership position of the business or real estate until the sharks are out of the water. 
If there is a logical strategy we will no doubt employ you to help with the immigration and tax issues. 
XXXXXXXXX
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david ingram replies:
I wish I had a good answer for you.  
Been involved in a stupid divorce myself at the moment, I cannot imagine your throwing $500,000 (US or Canadian) into a business venture for your brother at this point. 
Get the divorce over first.  Then, whatever you do will be up front, straight and clean for the authorities in the US if your desire is to import your brother.
However, if he has no degree and no special skills, importing him to the US will be difficult to say the least.  Better and easier  that he finds a new US lady to marry and she sponsors him into the US.
You can have any business you want in Canada.  It will be a little more difficult tax wise but if you were living in Portland and had a business in Washington State or California or living in New Jersey and had a business in Brooklyn, the tax consequences would be about the same in terms of paperwork.
Goto www.centa.com and read the [Entering the US] section.  It might give you some ideas.  The E2 visa in the January 1995 newsletter was written by Dennis Olson, former US Consul in Vancouver and will give you an idea of an investor visa.
Think about this one before investing half a million. 
It is 1:00 AM and I am going to bed now.
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