The Department of Homeland Security has fired its latest salvo in the ongoing battle over H-1B visa costs — and this one carries a staggering price tag.
On August 25, 2026, DHS published a proposed rule to establish a $103,265 fee for all cap-subject H-1B petitions, including bachelor's cap and advanced-degree quota cases.
The fee is more than one hundred times the current base filing fee for an H-1B petition and, if finalized as written, would be the single largest fee ever imposed on an immigration benefit request in the history of the agency.
What the Proposed Rule Would Do
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 fee would apply to all cap-subject employers, regardless of size.
The fee applies to petitions filed under the regular 65,000 cap and to those filed under the 20,000 advanced degree exemption. It does not apply to cap-exempt petitions, extensions, amendments, transfers for beneficiaries already counted against the cap, or any other I-129 classification.
In practical terms,
universities, related nonprofit entities, nonprofit research organizations, and governmental research organizations would be untouched.
The proposed fee would generate revenue to recover a portion of the federal government's costs for administering the lawful immigration system. These costs include adjudication of immigration benefits, fraud detection and national security vetting, systems modernization, records and fee collection operations, immigration court operations, consular visa processing, labor standards enforcement, and interagency coordination.
Based on 85,000 cap-subject petitions annually, DHS estimates the new fee could generate approximately $8.8 billion each year.
Notably,
the proposed rule does not address whether the fee would be returned if a petition is denied, rejected, or withdrawn.
Context: The $100,000 Proclamation Fee and Its Legal Demise
This proposal does not exist in a vacuum.
It comes one month after the First Circuit refused to let the government reinstate the $100,000 fee created by last September's presidential proclamation. After losing in court, DHS is now trying to get essentially the same money through a different legal door.
The backstory is crucial for understanding why this rule has appeared now.
On September 19, 2025, President Donald Trump issued Proclamation 10973, which imposed a $100,000 fee for new H-1B petitions filed for beneficiaries located outside of the United States. The administration stated that the fee was intended to address perceived abuse of the H-1B program and protect U.S. workers.
A coalition of 20 states challenged that fee in federal court.
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.
The government appealed, but
on July 24, 2026, the U.S. Court of Appeals for the First Circuit denied the federal government's request to pause the district court ruling.
The First Circuit found that the government had not shown it was likely to succeed on appeal or that the states would avoid substantial harm if the fee were allowed to resume.
This new proposal follows that series of ongoing legal battles. Unlike the previous temporary proclamation, this new measure is being pursued through the formal federal rulemaking process to make it permanent.
Why This Matters for Employers and Workers
The potential impact on U.S. businesses cannot be overstated.
The proposed $103,265 H-1B cap fee represents one of the most consequential immigration-related fee proposals in recent memory.
For small businesses, the impact could be devastating.
DHS's own analysis estimates the rule would have a significant economic impact on 11,051 small entities — 76% of the small entities that filed cap-subject petitions in FY 2025 — and identifies no alternative that would reduce that burden.
DHS estimates that the cost would exceed 1% of annual revenue for more than three-quarters of small filers.
The H-1B tax would likely reduce American business's willingness to sponsor employees for visas. The tax would effectively prevent many employers, particularly startups and small businesses, from retaining critical workers. Even large corporations could shift jobs and work to other countries to avoid having to pay this new and prohibitive cost, weakening our global competitiveness.
The impact extends beyond businesses to the workers themselves.
One of the H-1B program's primary functions is talent retention. In FY 2024, 54% of approved H-1B petitions for initial employment were for people already in the U.S., and nearly three-quarters of those had previously held student status at U.S. colleges and universities.
For these individuals — many of whom have spent years studying and building careers in the United States — the proposed fee could mean their employers simply decline to sponsor them, forcing them to leave the country.
The Rulemaking Process and What Comes Next
Critically,
employers do not currently have to pay the new $103,265 fee. This is simply a proposed rule.
DHS published it on August 25, 2026, with a thirty-day window for public comments closing on September 24, 2026.
DHS must review the comments and issue a final rule before the fee can take effect.
If the rule is finalized, the fee will apply to cap-subject petitions filed in 2027.
A 30-day window on an economically significant rule with an $8.8 billion annual price tag is aggressive. Executive Order 12866 contemplates 60 days as the norm for significant rules.
Some commentators have noted that this compressed timeline is itself a procedural issue worth raising in comments.
Comments must be filed through regulations.gov under DHS Docket No. USCIS-2026-0298.
Emails and letters to DHS officials do not count as comments. USCIS is not accepting mailed comments or digital media.
Legal Challenges Expected
Significant legal challenges to the rule are anticipated.
Legal experts expect the rule to draw challenges the moment it's finalized, with courts needing to decide whether a proposed fee this size is arbitrary and capricious, disconnected from the actual cost of adjudicating a petition, and whether DHS even has the statutory authority to set an immigration fee at this scale.
A legal challenge cannot be filed until a final rule issues; the NPRM is not final agency action.
What Employers and Workers Should Do Now
For now, the message is clear: do not panic, but do not stay silent.
Employers should not add the proposed fee to current filings unless and until a final rule establishes an effective date and applicable transition provisions.
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. Comments may be submitted through September 24, 2026.
Assess potential budgetary implications should the rule ultimately be implemented. Employers that regularly use the H-1B cap process should also stay in close contact with immigration counsel as DHS's proposal evolves.
With the comment deadline of September 24, 2026 fast approaching, all stakeholders — employers, immigration attorneys, affected workers, industry associations, and academic institutions — should consider making their voices heard through the formal comment process. The outcome of this rulemaking could define the future of employer-sponsored immigration in the United States for years to come.
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This article is for informational purposes only and does not constitute legal advice. Please consult with a qualified immigration attorney regarding your specific situation.