On August 25, 2026, the Department of Homeland Security published one of the most consequential proposed rules in the history of employment-based immigration.
DHS is proposing to establish 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 would be imposed in addition to all other applicable fees or payments.
The new charge is a standalone fee — 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.
What the Proposed Rule Would Do
DHS would charge $103,265 per H-1B cap-subject petition. 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, or transfers for beneficiaries already counted against the cap.
The exemption for cap-exempt filings is significant — universities, related nonprofit entities, nonprofit research organizations, and governmental research organizations would be untouched.
The fee is in addition to everything else: the base I-129 fee, the ACWIA fee, the fraud prevention and detection fee, the Asylum Program Fee, the H.R. 1 fees codified in the April 2026 interim final rule, premium processing if elected, and any payment required under Presidential Proclamation 10973 if that payment is ever reinstated. DHS states expressly that an employer subject to both would pay both.
How DHS Arrives at $103,265
DHS says the government spends about $8.8 billion a year on immigration-related costs. Divide that by the 85,000 H-1B visas available each year, and that comes out to roughly $103,265 — the proposed price tag.
DHS says 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.
Historically, USCIS fee rules generally recovered only USCIS's own 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.
Why This Matters: Impact on Employers and Workers
The practical implications of this rule — if it survives the rulemaking process and expected legal challenges — would be profound.
DHS's own economic analysis acknowledges the impact. In its proposal, the department estimated that the six-figure upcharge would force 11,051 small businesses — 76% of the small entities it analyzed — to experience a "significant economic impact" as a result of the fee.
The greatest impact is likely to fall on smaller employers, early-career hires, and international students moving from F-1 OPT or STEM OPT to H-1B status.
For a large employer, the fee could affect annual workforce budgets. For a startup or small business, one cap-subject H-1B petition could represent a cost equal to a major hiring expense, runway decision, or departmental budget item.
Critics say such a large upfront cost could discourage employers from retaining foreign graduates educated in the United States and make the country less competitive in attracting global talent.
The American Immigration Lawyers Association (AILA) called the proposed fee "exorbitant" and argued that it could prevent employers from using H-1Bs for critical positions, including teachers, researchers, rural doctors, and clergy.
The Fee vs. Tax Debate: Legal Challenges Ahead
Legal experts are already questioning whether DHS has the statutory authority to impose a charge of this magnitude, and the answer may determine whether this rule survives.
Under National Cable Television Association v. United States (1974) and FPC v. New England Power Co. (1974), a charge qualifies as a fee only when it confers a specific benefit on the payer. A charge that funds general public benefits is a tax, and taxing authority must be delegated by Congress with a clear statement.
DHS's own tables reveal that roughly 66 percent of the revenue goes to agencies and programs with no adjudicatory connection to the payer
— a fact that critics argue undermines the characterization of this charge as a "fee."
Jeff Robins, a senior counsel at BAL, has stated: "Opponents will argue that this still looks less like paying for an H-1B adjudication and more like using a tax to finance broader government operations."
DHS anticipates this challenge in the proposed rule, proactively asserting that its fee-setting authority under INA sections 286(m) and (n) extends to recovering costs incurred by other agencies. DHS acknowledges, however, that it has never applied this authority so broadly before.
A Second Swing After the First Was Struck Down
The new proposal follows extensive litigation over the Trump administration's previous effort to impose a $100,000 payment on certain H-1B filings. On June 8, 2026, a federal district court struck down that $100,000 fee, concluding that the administration had exceeded its authority.
The new $103,265 proposal takes a different route. Rather than attempting to impose the charge through a presidential proclamation, DHS is proceeding through formal notice-and-comment rulemaking and is grounding the proposed charge in its asserted statutory fee-setting authority. Whether DHS's different regulatory approach will withstand legal scrutiny will be closely watched.
Crucially, the proposal says that if an employer were subject to both requirements, both payments could potentially be required — creating a theoretical scenario in which the cost could exceed $200,000 per petition.
However, the presidential proclamation establishing the $100,000 fee is set to expire on September 21, 2026, unless extended.
What Employers and Workers Should Do Now
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.
DHS published the rule on August 25, 2026, with a thirty-day window for public comments closing on September 24, 2026.
Comments can be submitted through the Federal eRulemaking Portal at http://www.regulations.gov under DHS Docket No. USCIS-2026-0298.
Here is what stakeholders should consider:
- Submit public comments.
- Do not change current filings.
- Plan for contingencies.
- Document the impact. As one immigration firm advised, employers that abandon a cap selection, decline to sponsor, or lose a candidate because of anticipated fees should document it — that evidence matters for comments and for legal standing later.
The Bottom Line
This proposed rule is not yet law, and the road from proposed rule to enforceable regulation is long — particularly when legal challenges are all but certain. But the signal it sends is unmistakable: the administration remains committed to imposing dramatically higher costs on the H-1B program.
The decision to pursue a new $103,265 fee through formal notice-and-comment rulemaking, while continuing to defend the earlier $100,000 measure on appeal, is a strong indication that the administration remains determined to impose a substantial additional cost on H-1B sponsorship.
Employers, international workers, and the legal community should engage actively in the comment period and prepare for what may be a defining legal battle over the scope of DHS's immigration fee-setting power.
ClinchLaw will continue to monitor this rulemaking and provide updates as the comment period progresses and any legal challenges materialize.