On August 25, 2026, the Department of Homeland Security published a Notice of Proposed Rulemaking (NPRM) that could fundamentally reshape the economics of employer-sponsored immigration in the United States.
Under the proposed regulation, employers filing an H-1B cap-subject petition would be required to pay a new $103,265 fee at the time of filing, in addition to all other applicable government filing fees.
The public comment period is open until September 24, 2026.
The proposed $103,265 H-1B cap fee represents one of the most consequential immigration-related fee proposals in recent memory.
What the Proposed Rule Would Do
DHS would charge $103,265 per H-1B cap-subject petition, applying the fee to petitions filed under the regular 65,000 cap and to those filed under the 20,000 advanced degree exemption at INA 214(g)(5)(C).
This fee would apply only after a worker is selected in the lottery and the employer files the petition.
Critically,
it does not apply to cap-exempt petitions, extensions, amendments, transfers for beneficiaries already counted against the cap, or any other I-129 classification.
Universities, related nonprofit entities, nonprofit research organizations, and governmental research organizations would be untouched.
A footnote in the notice shows the math behind the $103,265 figure: total costs to be recovered of roughly $8,777,488,350, divided by the projected 85,000 cap-subject petitions issued annually.
The fee would be used for the federal government's costs of administering the lawful immigration system, including activities carried out by the DHS and the departments of Justice, State and Labor.
Why Now: The Court Ruling That Set the Stage
The proposed rule arrives in the wake of a significant legal defeat for the administration.
On September 19, 2025, President Trump issued a sweeping Presidential Proclamation imposing a $100,000 fee on new H-1B visa petitions.
On June 8, 2026, the U.S. District Court for the District of Massachusetts granted summary judgment in favor of the states on all claims and vacated the policy implementing the fee in its entirety. The court found that the $100,000 fee proclamation was not an immigration restriction, but rather a tax, which the president lacked authority to impose.
DHS proposed the new fee after that ruling, but this time the fee would impact an even wider swath of candidates for the program and apply to recent U.S. college graduates who were spared the $100,000 charge under the proclamation.
While the original proclamation only applied to workers seeking entry through consular processing abroad,
the NPRM is written to apply to cap-subject H-1B petitions generally, change-of-status cases included.
DHS has made its intent plain: this administration wants a six-figure H-1B fee, and if the courts take away the proclamation route, it will pursue the same outcome through rulemaking that is procedurally harder to unwind.
DHS's Justification — and Its Critics
The proposed fee is not intended merely to cover the cost of processing an H-1B petition, but rather to help fund broader immigration-system operations across the federal government.
Historically, USCIS fee rulemaking has been limited to recovering the cost of administering its own adjudications. Here, USCIS appears to be building in cost recovery for other federal agencies involved in the immigration system, including CBP, ICE, EOIR, DOS, and DOL. That is a meaningfully broader theory of "cost recovery" than USCIS has used before, and it is likely to be a central target of any comment or legal challenge.
Analysts point out that the proposed rule justifies the tax, in part, by claiming it is needed to provide more money to Immigration and Customs Enforcement, even though Congress appropriated approximately $75 billion for ICE in 2025 and $39 billion in 2026.
The U.S. Chamber of Commerce wasted no time responding.
Neil Bradley, executive vice president and chief policy officer at the Chamber, said the proposal "will make it cost-prohibitive for even more U.S. employers—especially the thousands of start-ups and small and midsize businesses who rely on H-1Bs—to utilize the program."
AILA President Jeff Joseph described it as "executive overreach on steroids."
Immigration attorney Emily Neumann characterized the effort more bluntly, calling it the "
same number, new wrapper, same playbook.
"
Legal Vulnerability
Although the new fee relies on different statutory authority than the proclamation and will proceed through the formal rulemaking process, attorneys and legal experts said it's no less vulnerable to legal challenge.
However, the legal battle lines may shift.
Caroline Tang, an immigration attorney at Ogletree Deakins, noted that litigation against the rule could target the proposed fee amount itself as potentially arbitrary and capricious. That is a higher bar for challengers than the separation-of-powers argument that worked against the proclamation, because DHS does have general statutory authority to set immigration benefit fees; the fight this time will center on whether $103,265 is a defensible number tied to actual administrative costs, or a punitive figure dressed up as a cost-recovery measure.
Practical Impact on Employers and Workers
If this rule goes into effect, it would impact all cap-subject H-1B petitions filed as of Fiscal Year 2028 — i.e., the spring 2027 H-1B lottery process for an October 1, 2027 start date.
The implications are particularly stark for smaller employers.
This could create serious problems for employers that do not have large immigration budgets. For a small employer, it could make hiring one highly qualified worker financially impossible.
School districts nationwide are struggling to find qualified educators, and the proposed fee will exacerbate this challenge for districts who rely on the H-1B program to recruit teachers. Last year, more than 500 school districts were utilizing the H-1B program to employ international teachers.
If the fee is collected and the rule is later vacated, the mechanics of getting $103,265 back per petition are not addressed in the proposal in any way that should give employers comfort.
What Employers and Workers Should Do Now
Do not panic and do not assume this is law. Nothing has taken effect. A proposed rule is a proposal.
Employers should not add the proposed fee to current filings unless and until a final rule establishes an effective date and applicable transition provisions.
That said, there are critical action steps:
- Submit public comments before September 24, 2026.
- Model budget scenarios.
- Evaluate alternative strategies.
- Consult immigration counsel.
The Bottom Line
A 30-day window on an economically significant rule with an $8.8 billion annual price tag is aggressive.
Whether the rule survives the rulemaking process and the near-certain legal challenges that will follow remains to be seen. But the administration's direction is unmistakable: it intends to impose a six-figure cost barrier on the H-1B cap process, one way or another.
For now, the most important date on every employer's calendar should be September 24, 2026 — the last day to make your voice heard.
ClinchLaw is closely monitoring this proposed rule and will provide updates as the comment period concludes and the rulemaking process advances. Contact our immigration attorneys to discuss how this proposal may affect your organization's hiring and immigration strategy.