On August 25, 2026, the Department of Homeland Security dropped what may be the most consequential immigration fee proposal in recent memory.
DHS published a proposed rule to establish a $103,265 fee for all H-1B cap-subject petitions, including those eligible for the advanced degree exemption.
The charge would be more than one hundred times the current base filing fee for an H-1B petition, and 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 proposal has immediately sent shockwaves through the employer community, immigration bar, and the international workforce that depends on the H-1B program. Here is what we know.
How the Fee Would Work
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.
For many employers, the proposed fee would be layered on top of existing H-1B filing costs, which already total approximately $6,300 per petition, depending on employer size and whether premium processing is requested.
The fee would apply to all cap-subject employers, regardless of size.
That means both a Fortune 500 technology company and a 10-person engineering firm sponsoring a single H-1B worker would face the same financial burden.
The fee 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.
A Novel Cost-Recovery Approach
What makes this proposal particularly unusual is not just the dollar amount, but how DHS arrived at it and where the money would go.
DHS identified total costs to be recovered of $8,777,488,035, divided that figure by an assumed annual volume of 85,000 cap-subject petitions, and arrived at $103,264.57, which it rounded to the nearest $5 increment.
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, the U.S. Department of State, and others.
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.
USCIS gets the largest single share, 34.2 percent or $3.0 billion, of which $1.8 billion covers unfunded costs from the agency's FY2026/2027 fee review, including 6,045 new staff positions, new facilities, and system modernization.
EOIR, the Executive Office for Immigration Review inside the Department of Justice, gets 33.7 percent or $2.96 billion.
In other words, the fee is not a measure of what it costs USCIS to adjudicate an H-1B petition — it is a revenue target divided by a headcount.
The Shadow of the $100,000 Fee Litigation
This proposal 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 U.S. District Court for the District of Massachusetts granted summary judgment in favor of the states on all claims — constitutional tax authority, APA violation, and statutory authority — 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.
However, just days later, the same court paused implementation of its decision, temporarily allowing USCIS to continue requiring the fee while the government's appeal proceeds.
The administration's appeal to the U.S. Court of Appeals for the First Circuit remains pending.
The new $103,265 fee would be separate from the prior $100,000 H-1B fee, and the presidential proclamation establishing the $100,000 fee is set to expire on September 21, 2026, one year after its issuance, unless extended.
By pursuing the new charge through notice-and-comment rulemaking rather than executive proclamation, DHS appears to be charting a different legal path — one that could be harder to challenge on separation-of-powers grounds.
Legal Challenges Expected
Nonetheless, immigration attorneys widely anticipate litigation.
Immigration attorneys, including Caroline Tang of Ogletree Deakins, have suggested the fee amount itself could be challenged as arbitrary and capricious under administrative law, rather than on the separation-of-powers grounds that succeeded against the earlier proclamation-based fee.
Congress has repeatedly and specifically legislated H-1B fee amounts — the ACWIA fee, the fraud prevention and detection fee, the 9-11 biometric fee — and 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 through a general cost-recovery provision.
Routing roughly $5.7 billion in fee revenue to DOJ, DOS, and DOL also raises Appropriations Clause and Miscellaneous Receipts Act concerns.
Jeff Joseph, President of the American Immigration Lawyers Association (AILA), commented that
"this proposed rule is different from and in addition to the $100,000 proclamation fee winding its way to the Supreme Court."
He added that he expects the rule to draw challenges the moment it is finalized.
Impact on Employers and Workers
The practical effects of this proposal, if finalized, cannot be overstated.
NFAP found over half of H-1B approvals for initial employment in FY 2025 went to employers with 15 or fewer approved petitions, and sixty-one percent of H-1B employers in FY 2025 had only one approved petition.
For these smaller employers, a six-figure fee per petition would be functionally prohibitive.
As Joseph explained, the impact on small and mid-sized employers would be especially severe:
"For a 30-person engineering firm, a regional healthcare staffing agency, or a small manufacturer that sponsors one or two H-1B workers a year, it's not a line-item; it's a decision to stop sponsoring altogether."
For employers who spent the past year adjusting sponsorship budgets around the earlier $100,000 fee, the proposal means the true cost of a single new H-1B hire could soon approach or exceed $200,000
when combined with other filing costs and potential proclamation fees.
For foreign workers, the consequences are equally stark. International students graduating from U.S. universities who depend on H-1B sponsorship to remain in the workforce face growing uncertainty. If employers decide the economics no longer work, these highly trained individuals may take their skills to competing economies abroad.
What Happens Next
The proposal has already generated significant concern among employers, but it is important to note that the fee is not currently in effect. The proposal is in the notice-and-comment stage, and DHS is accepting comments through September 24, 2026.
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.
What Employers and Workers Should Do Now
- Submit public comments.
- Assess budgetary exposure.
- Review alternative strategies. Employers should evaluate whether other visa categories, operational restructuring, or remote-work arrangements may provide pathways to retain international talent if H-1B sponsorship costs become prohibitive.
- Stay informed.
- Don't panic.
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ClinchLaw is monitoring this proposed rule and will provide updates as the comment period closes and any final rule or litigation develops. If you have questions about how this proposal may affect your immigration strategy, contact our team today.