DHS Proposes a $103,265 Fee for H-1B Cap-Subject Petitions: Employer Guide

DHS wants to charge $103,265 per H-1B cap-subject petition. The proposed rule, published August 25 as FR Doc 2026-17324, would attach that fee to every petition counted against the annual cap, both the 65,000 regular allotment and the 20,000 advanced-degree exemption, payable at the time of filing and on top of every existing USCIS fee, every attorney fee, and any Proclamation 10973 payment that's in force. It doesn't touch cap-exempt petitions, extensions, amendments, or change-of-employer filings.

Current USCIS fees stay in place until the final rule publishes. The comment window is short, though. DHS gave it 30 days, closing September 24, 2026, which is unusually compressed for a rule of this scale and suggests the agency wants an effective date on the calendar before the March 2027 H-1B cap-registration window opens.

The Proposed Rule at a Glance

Who's Covered (and Who Isn't)

The fee attaches to a specific slice of H-1B filings, not to the H-1B program as a whole. Under the proposal, the $103,265 applies to any petition subject to the annual numerical cap. That includes:

• Regular cap H-1B petitions filed against the 65,000 annual limit under INA section 214(g)(1)(A)
• Advanced-degree exemption petitions filed against the 20,000 additional slots under INA section 214(g)(5)(C) for beneficiaries with U.S. master's degrees or higher

The proposal explicitly does not touch cap-exempt filings. That means the fee would not apply to:

• Cap-exempt petitions filed by institutions of higher education, related or affiliated nonprofit entities, nonprofit research organizations, or governmental research organizations
• H-1B extension-of-stay petitions
• H-1B amended petitions (change in job duties, worksite, or terms of employment)
• H-1B change-of-employer petitions (H-1B portability)
• H-1B1 petitions (Chile / Singapore)
• Any H-1B petition for a beneficiary who was previously counted against the cap and hasn't left the country long enough to reset

So the working shorthand: the fee is a new-hire tax on the H-1B cap lottery, not a running-cost tax on the H-1B program.

What Actually Changes Under the Proposal

The number people are going to key on is $103,265, but the interaction with the existing fee stack is what actually determines what a petition costs. This is the current-vs-proposed picture for the most common cap-subject filing scenarios.

DHS's own framing in the preamble puts the fee on a specific footing. USCIS describes it as a "dedicated revenue mechanism to help recover a portion of the federal government's costs of administering the lawful immigration system," including work carried out by DHS itself, DOJ, DOS, and DOL. Read plainly, the agency is proposing to shift a slice of the immigration system's operating budget onto cap-subject H-1B petitioners.

What This Means for the FY2027 Cap Season

The next H-1B cap registration window opens in March 2027 for fiscal year 2027 filings. If the final rule matches the proposal and takes effect before then, every registration that gets selected in the March 2027 lottery would carry the $103,265 fee at the point of filing the actual petition (typically April through June 2027). Three consequences follow for the way HR and TA plan for that window.

The first is that per-petition budgeting stops being an incidental line item. A mid-size employer running twelve cap-subject petitions a year moves from a low-six-figure H-1B budget to something in the neighborhood of $1.5 million on the fee alone, before attorney fees and any Proclamation payment that's in force. Cap-subject H-1B stops being a viable hiring channel for many employers who use it occasionally, which will push demand toward cap-exempt sponsorships (universities, affiliated nonprofits, research organizations) where they exist.

The second is that lottery strategy changes. Today, employers commonly register more candidates than they need, on the assumption that only about one in four selections will yield a viable filing. At $103,265 per selection, the incentive flips; employers will register only the candidates they're truly committed to hiring, because a selected registration they don't file wastes only the registration fee, but a selected registration they do file costs six figures. Expect registration volumes to drop and selection odds per registrant to improve.

The third is that cap-exempt hiring becomes more strategically valuable than it has been. Universities, teaching hospitals, and 501(c)(3) research organizations that qualify as cap-exempt won't see any change in their H-1B costs. Employers with cap-exempt affiliates or research partnerships have a lever they don't have today. This will change the map of where H-1B beneficiaries actually work.

What Employers Should Do Between Now and September 24

The comment window closes September 24, which is inside two weeks of publication. Which means the work between now and then splits into two parallel tracks: budget the exposure, and get any comment on the record before the window shuts.

Start with the budget picture. Pull the last three years of your H-1B cap-subject filings and count how many the org would have filed if this fee had been in effect. That's your rough annual exposure at the proposed rate. Do the same for the FY2027 cap season already on the calendar, sorted by role criticality; that's the list Finance and the CFO's office need to see, because the H-1B budget line changes by an order of magnitude for most mid-size employers.

With the exposure quantified, decide whether the organization has a position worth filing.

1. File a public comment. Comments close September 24 at regulations.gov (docket USCIS-2026-0298). USCIS is required to respond to substantive comments in the preamble of the final rule. Employer associations, industry groups, and individual companies routinely file on rules of this shape, and the comment window is uncommonly short for a rule of this scale.
2. Map cap-exempt options. If the org has university partnerships, affiliated research nonprofits, or teaching-hospital relationships, understand which of them could serve as cap-exempt petitioners for critical hires. Cap-exempt filings would be unaffected by the fee.
3. Rebuild the FY2027 registration list on the assumption the fee applies. Talent acquisition and immigration counsel should be looking at the current registration pipeline as if the fee is real, not as if it's hypothetical. The candidates who make the cut at $103,265 per selection are a different list than the candidates who make the cut at current costs.

One thing not on that list is filing anything with USCIS today on the strength of the proposal. Current fees are still current fees. Change nothing on live petitions until the final rule publishes and its effective date arrives.

Find Out What Your FY2027 H-1B Exposure Actually Looks Like

The employers most exposed to this rule are the ones running the largest cap-subject pipelines, which are also the ones with the most complex I-9 populations to keep clean while the immigration cost structure shifts underneath them. Our compliance team can pull the H-1B and dependent-EAD population out of your I-9 book, sort them by classification and upcoming reverification date, and give you the map of who's in scope for which rule. Schedule a free compliance call, or run the exposure through our I-9 Risk Calculator.

The Interaction with Proclamation 10973

The elephant in the room is the $100,000 payment DHS started collecting on H-1B petitions filed on or after September 21, 2025 under Presidential Proclamation 10973 ("Restriction on Entry of Certain Nonimmigrant Workers"). On June 8, 2026, the U.S. District Court in California v. Mullin, 25-13829 (D. Mass.), vacated the DHS action implementing the Proclamation 10973 payment. That vacatur is currently in place, and by its own terms the Proclamation, unless extended, expires September 21, 2026.

The proposed $103,265 fee is written to sit alongside the Proclamation payment, not to replace it. DHS explicitly states in the preamble that the two are separate obligations under different authorities: the Proclamation 10973 payment is an entry-restriction condition based on INA sections 212(f) and 215(a), while the new $103,265 fee is a USCIS-imposed statutory filing fee under 8 CFR Part 106. If both are in force, both apply. Whether the Proclamation payment gets reinstated on appeal, is extended by a successor proclamation, or lapses on September 21 will determine whether the effective per-petition cost lands at $103,265 or at $203,265.

Three Open Questions Nobody Can Answer Yet

The effective date is the loudest unknown. The proposal doesn't set one, because that number gets assigned when USCIS publishes the final rule. DHS is running the comment period on a compressed 30-day window, which is unusually short for a rule of this scale and suggests the agency is targeting an effective date well before the March 2027 cap-registration window. Employers planning FY2027 filings should assume the fee could be in force by then, even if that's not guaranteed.

Litigation is the second, and it's essentially assumed. A fee of this size, imposed via notice-and-comment rulemaking on the largest employment-based nonimmigrant category, will draw suits from major employer groups (Chamber of Commerce, ITServe Alliance, universities and university associations), immigration advocacy organizations, and likely one or more state attorneys general. Whether a preliminary injunction issues before the rule takes effect, and whether the courts eventually leave it in place, is unpredictable. The Mullin vacatur of the Proclamation 10973 payment is a data point on how the D. Mass. bench has read DHS authority in adjacent territory.

The interaction with Congress is the third. The preamble references DHS revenue estimates that incorporate the H.R.1 (One Big Beautiful Bill Act) fee changes deposited in the Immigration Examinations Fee Account. Congress could pre-empt the rulemaking entirely by writing an H-1B fee into statute, and the Proclamation 10973 payment could also be extended by executive action beyond September 21. The final H-1B cost picture for FY2027 depends on all three tracks (the proposed fee, the Proclamation payment, and any statutory action) landing more or less simultaneously.

"A $103,265 per-petition fee doesn't just make cap-subject H-1B more expensive; it changes who's in the market for cap-subject sponsorship. The employers who used to file two or three cap petitions a year to cover a specific engineering hire will not be running that math at $103,265, especially if the Proclamation 10973 payment gets stacked on top. Where we're telling clients to spend their time this week is on the two-list problem: which of our current cap-subject employees are we still sponsoring under the new math, and which cap-exempt sponsorship channels do we have that we haven't been using," says Patricia Duarte, Director of Compliance at i9 Intelligence.

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Frequently Asked Questions

Is the $103,265 fee in effect right now?

No. What DHS published on August 25 was a Notice of Proposed Rulemaking, not a final rule. The current USCIS fee schedule stays in effect until DHS publishes a final rule and that rule's effective date arrives. Don't change any live filings or petition budgets today on the strength of the proposal.

Which H-1B petitions would the fee apply to?

H-1B cap-subject petitions only, meaning petitions filed against the 65,000 regular cap and the 20,000 advanced-degree exemption. The fee would not apply to cap-exempt petitions (universities, affiliated nonprofits, nonprofit research organizations, governmental research organizations), extensions of stay, amended petitions, or change-of-employer (portability) petitions for beneficiaries already counted against the cap.

Does the fee replace the $100,000 Proclamation 10973 payment?

No. DHS explicitly states in the preamble that the $103,265 fee is a separate obligation under different authority than the Proclamation 10973 payment. If both are in force at the same time, both would apply to the same cap-subject petition. The Proclamation 10973 payment is currently vacated by California v. Mullin, 25-13829 (D. Mass. June 8, 2026), and by its own terms the Proclamation expires September 21, 2026 unless extended.

When would the fee take effect?

The Federal Register notice doesn't set an effective date; that gets assigned at final-rule publication. Public comments are due September 24, 2026. The unusually short comment window (30 days for a rule of this scale) suggests DHS is targeting an effective date before the March 2027 H-1B cap-registration window, but that timing isn't guaranteed. Track the docket at regulations.gov (USCIS-2026-0298).

Are there any waivers or fee exemptions?

None are proposed. The rule as written applies the $103,265 fee to every cap-subject petition without waivers, reductions, or fee-exempt categories. Employers who currently qualify for the small-employer ACWIA exemption on other H-1B fees would still owe the new fee in full.

What if a cap petition is selected in the lottery but the employer decides not to file it?

The fee is payable at the time of petition filing, not at registration. A selected registration that's never converted into an actual petition wouldn't owe the fee. The economic incentive under the proposal is to register only candidates the employer is genuinely committed to filing for, which is a notable behavior change from the current pattern of registering many more candidates than the org actually plans to sponsor.

How do I file a public comment?

Submit at regulations.gov under docket USCIS-2026-0298 by September 24, 2026. Comments must be in English (or with an English translation). USCIS is required to respond to substantive comments in the preamble to the final rule. Employer associations, HR industry groups, universities, and companies with a direct interest routinely file on rules of this shape.