DHS Proposes $103,265 Fee on Cap-Subject H-1B Petitions: What Employers Must Know Before the September 24 Comment Deadline

On August 25, 2026, the Department of Homeland Security (DHS) published a notice of proposed rulemaking that would impose an additional $103,265 fee on every H-1B cap-subject petition. The proposed fee would apply to petitions filed under both the regular H-1B cap and the advanced-degree exemption.

The fee is not currently in effect. DHS must first review public comments and issue a final rule. Public comments are due by September 24, 2026, through Regulations.gov under Docket No. USCIS-2026-0298.

Employers should begin financial and immigration strategy planning now. The proposal could materially affect the cost of sponsoring a work visa for foreign employees during the FY 2028 H-1B cap season.

What the Proposed H-1B Fee Would Require

If finalized as proposed, the new fee would be:

• $103,265 per H-1B cap-subject petition.
• Payable at the time the Form I-129 petition is filed.
• Required in addition to all existing H-1B filing fees and statutory payments.
• Applicable to both regular-cap and advanced-degree exemption petitions.
• Separate from any payment required under a presidential proclamation or other legal authority.

The fee would be codified at 8 CFR 106.2(a)(3)(xii). The official Federal Register notice identifies the proposal as “Fee for Certain H-1B Petitions,” Federal Register Document No. 2026-17324.

Existing costs may include the Form I-129 filing fee, the American Competitiveness and Workforce Improvement Act fee, the fraud prevention and detection fee, the Asylum Program Fee, the H-1B registration fee, and optional premium processing. The exact fee schedule must be reviewed at the time of filing because current fees and requirements may change.

Which H-1B Petitions Would Be Covered?

The proposed fee would apply to petitions subject to the annual H-1B numerical limitations. These limits currently include:

• The regular annual allocation of 65,000 H-1B visas or grants of status.
• The additional 20,000 allocation for beneficiaries who hold a qualifying U.S. master’s degree or higher.

The 20,000 advanced-degree allocation is commonly called the master’s cap. A petition selected under the advanced-degree exemption would still be subject to the proposed $103,265 fee because it remains subject to the annual numerical allocation.

Accordingly, employers should not assume that a master’s cap petition avoids the proposed fee. The proposal expressly covers both categories.

If finalized with the proposed timing, the fee would target FY 2028 cap-subject H-1B petitions expected to be filed during calendar year 2027. The final rule would control the applicable filing dates and implementation requirements.

Which Petitions Would Not Be Covered?

The proposal would not apply to H-1B petitions that are not subject to the annual cap. Proposed exclusions include:

• Petitions filed by qualifying institutions of higher education.
• Petitions filed by qualifying nonprofit research organizations.
• Petitions filed by qualifying governmental research organizations.
• Petitions filed by certain affiliated or related nonprofit entities.
• Extensions for H-1B workers who were previously counted against the cap.
• Amendments for existing H-1B workers who were previously counted against the cap.
• Changes of employer for existing H-1B workers who were previously counted against the cap.
• Other petitions that do not seek a new allocation of an H-1B cap number.

The analysis is fact-specific. Nonprofit status alone does not establish a cap exemption. Employers must evaluate the organization, employment relationship, position, beneficiary history, and applicable statutory exemption.

A worker employed by a cap-exempt institution may become subject to the cap when moving to a cap-subject employer. Conversely, an H-1B worker who was previously counted against the cap may qualify for a later extension, amendment, or change-of-employer petition without a new cap allocation.

Employers should maintain documentation supporting any claimed exemption.

DHS Estimates $8.8 Billion in Annual Revenue

DHS states that the proposed fee would generate approximately $8.8 billion annually, based on a projected filing volume of 85,000 cap-subject petitions.

The proposal is structured as an interagency cost-recovery mechanism. Revenue would support activities involving six federal agencies or components:

• U.S. Citizenship and Immigration Services (USCIS).
• U.S. Immigration and Customs Enforcement (ICE).
• U.S. Customs and Border Protection (CBP).
• The Department of Justice’s Executive Office for Immigration Review (EOIR).
• The Department of State (DOS).
• The Department of Labor (DOL).

The identified activities include immigration benefit adjudication, fraud detection, national security vetting, systems modernization, immigration court operations, consular processing, labor standards enforcement, and interagency coordination.

DHS estimates that the fee would affect a significant number of small entities. The proposal does not provide a discounted rate for small employers. The amount would apply uniformly to covered cap-subject petitioners if the rule becomes final.

The Proposed Rule Is Not Yet in Effect

Employers do not currently owe the proposed $103,265 fee. The proposal is not a final regulation, and it does not create an immediate filing obligation.

Before the fee could become payable, DHS would need to:

1. Review public comments.
2. Decide whether to proceed with the rule.
3. Publish a final rule.
4. Establish an effective date.
5. Issue implementation instructions and update USCIS filing guidance.

DHS could revise the fee amount, scope, effective date, or payment procedures. It could also withdraw the proposal.

Employers should continue following the current USCIS H-1B requirements and applicable Form I-129 instructions for present filings.

Relationship to the Earlier $100,000 H-1B Payment

The proposed $103,265 fee is separate from the earlier $100,000 payment associated with Presidential Proclamation 10973. The two measures rely on different legal authorities.

The earlier $100,000 payment has been subject to litigation. In June 2026, a federal court in Massachusetts vacated the agency guidance implementing that payment. The government appealed, and further court orders or agency action may affect the payment’s practical status.

The proclamation-based payment is also scheduled to expire on September 21, 2026, unless extended. Employers must distinguish among:

• The proposed $103,265 regulatory fee.
• The earlier $100,000 proclamation payment.
• Existing H-1B filing fees.
• Statutory fraud-prevention and workforce-related payments.
• Any future fees established by legislation, regulation, or agency action.

The Federal Register notice states that, if both obligations were legally applicable to a filing, the proposed fee would be in addition to the proclamation payment. Employers should not assume that both payments currently apply or that either requirement will remain unchanged.

Litigation challenging the proposed rule is anticipated, particularly given the recent vacatur of the similar $100,000 payment. The outcome cannot be predicted. Employers should monitor court orders, agency guidance, and the final rulemaking record.

Employer Action Items Before the September 24 Deadline

1. Model Multiple Budget Scenarios

Finance, human resources, legal, and business leaders should model:

• Current H-1B sponsorship costs.
• A full $103,265 additional fee.
• A revised or reduced fee.
• A scenario in which the proposal is delayed or withdrawn.
• Additional applicable fees or payment obligations.
• Alternative immigration classifications.

The model should account for the number of potential petitions, projected filing dates, selection probabilities, and the effect on recruitment budgets.

2. Review H-1B Registration Strategy

The proposed fee may change the financial consequences of registering beneficiaries for the H-1B cap. Employers should review:

• The number of registrations they expect to submit.
• The business necessity of each position.
• The likelihood that a selected registration will result in a petition.
• Whether candidates have potential cap-exempt options.
• Whether the employer has an alternative immigration strategy.

Employers should not submit registrations that do not reflect a legitimate, supportable business need.

3. Assess Cap-Exempt Options

Employers should determine whether a position may qualify for cap-exempt treatment through:

• A qualifying institution of higher education.
• A nonprofit research organization.
• A governmental research organization.
• A qualifying affiliated or related nonprofit entity.
• A qualifying employment relationship with an exempt institution.

This review requires more than examining tax status. The organization’s purpose, affiliation, funding, employment arrangement, and work performed may be relevant.

4. Evaluate Alternative Classifications

Depending on the facts, alternatives may include:

• L-1 classification for qualifying intracompany transferees.
• O-1 classification for individuals with extraordinary ability.
• TN classification for eligible Canadian or Mexican professionals.
• E-3 classification for eligible Australian professionals.
• H-1B1 classification for eligible citizens of Chile or Singapore.
• Employment-based permanent residence.

Each classification has separate eligibility standards and limitations. Employers should not select an alternative solely to avoid a potential fee.

5. Submit Effective Public Comments

Employers, industry organizations, and other stakeholders may submit comments through Regulations.gov by September 24, 2026. Comments should identify Docket No. USCIS-2026-0298 and address specific provisions of the proposal.

A substantive comment should:

1. Identify the relevant section of the proposed rule.
2. Explain the legal, operational, or financial concern.
3. Provide supporting data or authority.
4. Recommend a specific change.

Comments should be submitted through the designated federal portal. Emails, mailed letters, and other submissions may not be treated as formal comments. Submitted comments may become publicly available.

6. Review Workforce Compliance

Changes in H-1B strategy do not eliminate Form I-9 and employment authorization obligations. Employers should review:

• Form I-9 completion and retention.
• Employment authorization expiration tracking.
• Reverification procedures.
• Labor Condition Application obligations.
• Public access file requirements.
• Consistency among payroll, personnel, and immigration records.

Blasingame Law LLC provides guidance regarding I-9 compliance for U.S. employers and broader workforce compliance planning.

What Employers Should Monitor

Until DHS publishes a final rule, employers should monitor:

• The Federal Register notice.
• The USCIS announcement.
• The Regulations.gov docket.
• USCIS filing instructions and fee schedules.
• Litigation involving the proposed fee or related H-1B payment requirements.
• Court orders concerning the $100,000 proclamation payment.
• Agency guidance affecting FY 2028 H-1B filings.

The proposed $103,265 fee represents a significant potential cost for employers seeking a work visa for foreign employees. It is not currently payable, but it should be included in contingency planning for the H-1B visa 2026 and FY 2028 planning cycles.

Blasingame Law LLC advises employers on H-1B petitions, business immigration strategy, workforce compliance, and alternative employment-based options. Review our H-1B visa resources or Business Immigration Solutions. Contact a qualified business immigration attorney or immigration lawyer before submitting registrations, relying on a cap exemption, changing hiring plans, or filing a petition affected by this proposal.

This article provides general educational information based on the proposed rule and publicly available materials as of September 16, 2026. It is not legal advice and does not create an attorney-client relationship. Immigration fees, agency guidance, litigation, and regulatory requirements may change. Employers should consult Blasingame Law LLC regarding specific cases and compliance decisions.