DHS Proposes Staggering $103,265 Fee for All H-1B Cap-Subject Petitions, Threatening to Reshape Employer Hiring Strategies

What the Proposed Rule Would Do#

The proposed fee would be paid at the time of filing and would be imposed in addition to all other applicable fees or payments.

The new charge is more than one hundred times the current base filing fee for an H-1B petition.

If finalized as written, it would be the single largest fee ever imposed on an immigration benefit request in the history of the agency.

The fee would apply to all cap-subject employers, regardless of size.

However, it would not apply to cap-exempt petitions — those filed by universities, nonprofit research organizations, and government research organizations — or to petitions to extend or amend existing H-1B status or to change an existing H-1B to a different employer.

How DHS Arrived at $103,265#

The fee figure did not emerge arbitrarily — at least not on paper. Historically, USCIS fee rules generally recovered only USCIS's costs. The proposal would adopt a novel interagency cost-recovery approach, using the fee to recover approximately $8.78 billion in identified costs across six federal agencies, including USCIS, the U.S. Department of Labor, U.S. Immigration and Customs Enforcement, and the U.S. Department of State.

Divided among 85,000 projected cap-subject petitions, those costs equal approximately $103,265 per petition. The proposed rule states that cap-subject H-1B employers are best suited to bear these added costs.

Perhaps most notably, DHS does not justify the fee based on the cost of adjudicating an individual H-1B petition. Instead, the agency proposes using H-1B cap filings as a funding mechanism to support a broad range of immigration-related government functions across multiple federal agencies. This represents a significant departure from the traditional fee-for-service model generally associated with immigration benefit requests.

The Shadow of the $100,000 Proclamation Fee#

The proposed rule does not exist in a legal vacuum. It follows a turbulent year of litigation over the administration's earlier attempt to impose a six-figure fee on H-1B petitions through executive action.

A Presidential Proclamation, signed on September 19, 2025, imposed a new $100,000 fee on new H-1B visa applications submitted on or after September 21, 2025. That fee applied to petitions involving consular processing for beneficiaries outside the United States.

On June 8, 2026, the U.S. District Court for the District of Massachusetts invalidated the fee, concluding that the fee functioned as a tax rather than a regulatory filing fee, the executive branch lacked authority to impose such a tax without congressional approval, and the implementing agencies exceeded their authority and violated the Administrative Procedure Act.

The government appealed on June 11, and on July 24, 2026, the First Circuit refused to pause the district court's judgment while that appeal runs.

Proclamation 10973 expires on September 21, 2026, unless extended, and the rule acknowledges in a footnote that the proclamation lapses before this fee could take effect.

DHS concedes the fee is "close to" the $100,000 payment under Proclamation 10973. But the new proposal takes a fundamentally different legal route. The new proposed rule is legally distinct from that executive order. DHS is pursuing a fee structure through formal rulemaking, which relies on different legal authority.

Legal Challenges Ahead#

Immigration attorneys widely expect a new wave of litigation if the rule is finalized. 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.

Impact on Employers and Workers#

The practical implications for employers are significant. DHS acknowledges that the proposal would have a significant impact on employers, including small businesses. The agency estimates that approximately 76% of small entities filing H-1B cap petitions would experience a significant economic impact under the proposal.

The fee would come on top of existing H-1B filing costs, anti-fraud fees, asylum program fees, ACWIA fees, registration fees, and premium processing fees. For many employers, the total cost of sponsoring a single cap-subject H-1B worker could exceed $110,000 when all fees are combined — a sum that could eliminate the economic rationale for H-1B hiring at many companies, particularly small and mid-size businesses.

For international professionals already in the United States on student visas or other temporary work visas, the ripple effects could be equally devastating. If employers conclude that the cost of cap-subject H-1B sponsorship is prohibitive, many foreign nationals may find themselves unable to secure employer sponsorship, potentially forcing them to leave the country or seek alternative pathways.

What Happens Next#

The proposal is in the notice-and-comment stage, and DHS is accepting comments through September 24, 2026.

After reviewing comments, DHS will decide whether to finalize, revise, or withdraw the rule. If the rule is finalized, the fee could apply to H-1B cap-selected petitions as early as April 1, 2027, unless litigation blocks its implementation.

Based on the rulemaking timeline, employers should plan on the FY 2029 cap season, with registration and filings in spring 2028, as the first cap cycle realistically exposed to this fee.

Employers should not add the proposed fee to current filings unless and until a final rule establishes an effective date and applicable transition provisions.

The Bottom Line#

The $103,265 proposed fee represents the administration's most aggressive regulatory effort yet to reshape the H-1B program through pricing. Whether pursued as a genuine cost-recovery mechanism or as a policy tool designed to discourage employer use of the H-1B visa, the proposal — if finalized — would mark a historic inflection point for U.S. employment-based immigration.

Employers with H-1B-dependent workforces should begin evaluating their immigration strategies now, submit public comments before the September 24 deadline, and consult with experienced immigration counsel to prepare for a range of possible outcomes. As one immigration law firm put it, DHS has "made its intent plain: this administration wants a six-figure H-1B fee."

This article is for informational purposes only and does not constitute legal advice. If you have questions about how this proposed rule may affect your situation, please contact ClinchLaw for a consultation.