The Department of Homeland Security has fired its latest salvo in the battle over H-1B visa costs.
On August 25, 2026, DHS published a Notice of Proposed Rulemaking (NPRM) proposing a $103,265 fee for all H-1B cap-subject petitions, including those eligible for the advanced degree exemption.
The proposed fee would be paid at the time of filing and imposed in addition to all other applicable fees or payments.
The proposal—one of the most consequential immigration fee actions in recent memory—arrives after federal courts blocked the administration's earlier attempt to levy a $100,000 charge on H-1B petitions through presidential proclamation. This time, DHS is taking a different legal route, pursuing formal notice-and-comment rulemaking rather than executive fiat.
What the Proposed Rule Would Do
DHS would charge $103,265 per H-1B cap-subject petition, applying to petitions filed under the regular 65,000 cap and to those filed under the 20,000 advanced degree exemption.
The fee would apply to all cap-subject employers, regardless of size.
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.
The fee would apply only after a worker is selected in the lottery and the employer files the petition.
How DHS Arrived at $103,265
DHS identified approximately $8.8 billion in costs across the federal immigration system that it proposes to recover through the fee, calculating the amount by dividing approximately $8.777 billion in costs by a projected 85,000 fee-paying cap-subject H-1B petitions each year. The result is $103,264.57, which DHS rounded to $103,265.
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.
Approximately 34% of the projected revenue would go to USCIS and 33% to the Executive Office for Immigration Review (EOIR), which operates the federal immigration courts. The remaining revenue would support immigration-related costs at ICE, CBP, DOL, and the State Department.
The $100,000 Proclamation Fee: Background
The proposed rule does not exist in a vacuum.
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 federal district court vacated the H-1B proclamation fee policy in its entirety, taking the position that the $100,000 fee amounted to a tax
imposed without proper congressional authorization.
On July 24, 2026, the U.S. Court of Appeals for the First Circuit denied the government's request for a stay,
meaning the district court's ruling remains in effect, and the $100,000 H-1B fee cannot currently be enforced while the case continues through the courts.
On September 18, 2026, the President extended the $100,000 H-1B fee for another year, through September 2027,
though it remains blocked by judicial order.
Could Employers Owe Both Fees?
This is a critical question for workforce planning.
The proposed $103,265 fee would be separate from the prior $100,000 H-1B fee.
USCIS has proposed a regulation that would impose a fee of $103,265 on cap-subject H-1B petitions, which is distinct from the $100,000 payment requirement established through the presidential proclamation and is proceeding through a separate regulatory process. If the proposed rule is finalized and the proclamation-based payment requirement is later reinstated through further court action, certain H-1B filings could potentially be subject to both requirements.
The Staggering Cost to Employers
To put this in perspective,
a standard cap-subject H-1B petition currently runs roughly $5,500 to $9,500 before premium processing,
encompassing the I-129 filing fee, ACWIA training fee, fraud prevention fee, and Asylum Program fee. Adding $103,265 on top would increase total filing costs by more than a factor of ten.
For example, if an employer files five cap-subject H-1B petitions after the proposed rule takes effect, the new fee alone could total $516,325.
For companies that sponsor dozens or hundreds of H-1B workers annually, the financial impact could be measured in the tens of millions.
Legal Challenges Expected
The proposed $103,265 H-1B cap fee represents one of the most consequential immigration-related fee proposals in recent memory.
Challenges to the legality of the fee are expected, for example, on the basis that the fee exceeds what would be needed to recover the full costs of providing the service.
When Congress sets specific dollar figures for a program again and again, the natural inference is that it did not silently authorize the agency to impose a $103,265 charge on the same program through a general cost-recovery provision.
AILA President Jeff Joseph issued a sharp rebuke, calling the proposal "executive overreach on steroids" and warning that the fee "would shut out employers that use H-1Bs to fill job openings for essential staff like teachers, researchers, rural doctors, and clergy."
DHS assumes 85,000 petitions will be filed and paid while simultaneously claiming the fee's benefit is that employers "would be less likely to hire an H-1B worker" and conceding registrations may fall. Critics note these cannot both be true: if the deterrent works, the revenue does not materialize and the cost recovery fails.
Timeline and What Comes Next
The proposed rule has not been approved and is not currently effective. Employers are not required to pay this fee for any current USCIS petitions or pending filings.
Publication in the Federal Register on August 25, 2026, opens a 30-day public comment period. Stakeholders, employers, industry groups, and affected individuals have until late September 2026 to submit formal feedback via regulations.gov.
DHS must review and consider public feedback before issuing a Final Rule.
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.
A legal challenge cannot be filed until a final rule issues, since the NPRM is not final agency action. However, expect complaints filed within days of publication of a final rule, along with motions for preliminary injunction or expedited summary judgment.
What Employers and Workers Should Do Now
Employers should evaluate anticipated H-1B hiring needs for upcoming fiscal years and consider submitting comments, either individually or through industry associations, particularly if the proposed fee could have a material impact on recruiting, workforce planning, budget forecasting, or business operations.
Employers that rely on the H-1B program may need to account for higher immigration costs in their budgets and reassess how the added expense could affect hiring plans, sponsorship decisions, and recruitment for roles requiring specialized skills or advanced degrees.
For H-1B workers and prospective applicants, the proposed rule does not change any current filing obligations. However, the long-term implications are significant: if the fee survives legal challenges and takes effect, it could dramatically reduce the number of employers willing to sponsor new H-1B workers, fundamentally altering the landscape for international professionals seeking to work in the United States.
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Clinch Law Firm is monitoring this proposed rule and will provide updates as the comment period closes and the rulemaking process advances. Employers with questions about how this proposal may affect their immigration strategies should consult with qualified immigration counsel.