IN THIS GUIDE · Whether inventory and goodwill count when a lumberyard is bought
Start with the E-2 eligibility and application overview
Step one: settle ownership and control before anything is signed
E-2 is available to a national of a treaty country, which Canada is, who has invested in an enterprise at least fifty percent owned by nationals of that treaty country and who will develop and direct it. If Ismail buys the yard outright through a company he alone owns, both conditions are met and nothing further is needed on this point. If a local partner is taking a share, the split has to be settled first, because an agreement signed at a minority percentage and amended later reads as a structure built for the application rather than for the business.
Step two: allocate the purchase price in writing, then measure proportionally
Inventory purchased for the business is ordinarily capital invested, and so is goodwill paid for as part of an ongoing enterprise; neither is disqualified for being intangible or saleable. What matters is that the money is irrevocably committed and at risk in a real operating enterprise. Substantiality is judged in proportion to the total cost of purchasing an established business of this kind, not against any fixed figure, and no universal minimum exists. A yard bought largely as inventory can therefore be a strong case, provided the purchase agreement allocates the price by category and the valuation behind each allocation can be shown.
Step three: commit the funds so they are at risk but not simply forfeited
Capital sitting in Ismail's Canadian account is not committed, and money held back as working capital that he could withdraw is not at risk. The usual structure is a signed purchase agreement with the price paid into escrow, released to the seller on approval and returned only on refusal. Each dollar needs a path from its origin, whether retained earnings from the Powassan business, personal savings or a loan he has secured against his own assets, to that escrow. Borrowing secured against the American company's own assets does not count toward his investment.
Step four: answer marginality with the yard's own history
An enterprise producing only enough income to support the investor and his family may be found marginal. An operating lumberyard with staff on payroll is rarely marginal, and the evidence for that is already in the seller's records: employee lists, payroll registers, several years of financial statements. Ismail should obtain those before closing rather than relying on projections he writes afterwards. E-2 provides no direct path to permanent residence, so if settling permanently is the family's goal, that is a separate question for a licensed U.S. immigration attorney rather than an assumption to carry into the purchase.
Sources reviewed 2026-09-07. This guide covers a preparation focus; it is not an individual eligibility assessment.