Business Immigration Updates: DHS Proposes $103,265 Charge for Cap-Subject Petitions

The Department of Homeland Security (DHS) has proposed a new $103,265 fee for H-1B cap-subject petitions, a major potential change for employers that rely on the annual H-1B cap to recruit and retain professional talent.

Importantly, the proposed fee would apply only to cap-subject H-1B petitions, not to H-1B filings generally. In practical terms, the fee is aimed at employers filing petitions for workers selected through the annual H-1B cap process. It would not apply to cap-exempt H-1B petitions, including typical extensions or changes of employer for workers who have already been counted against the H-1B cap and remain eligible for cap exemption.

Published in the Federal Register on August 25, 2026, the proposal would require employers to pay the new fee at the time an H-1B cap-subject petition is filed, in addition to the filing fees and other payments already required for an H-1B case. Importantly, this is a proposed rule, not a final rule, and employers are not currently required to pay the new fee. Public comments are due by September 24, 2026.

What DHS Is Proposing

Under the proposed rule, the $103,265 charge would apply to petitions subject to the annual H-1B numerical cap, including petitions filed for beneficiaries eligible for the 20,000 U.S. advanced-degree exemption.

The proposal would not apply to cap-exempt H-1B petitions. This means the proposal should not be viewed as a $103,265 surcharge on every H-1B case an employer files. Instead, the principal exposure is associated with obtaining an initial H-1B number through the annual cap process.

DHS calculated the proposed amount by identifying approximately $8.78 billion in annual immigration-related costs and dividing those costs across a projected 85,000 fee-paying H-1B cap petitions. The resulting $103,265 fee would be used not only to support USCIS, but also immigration-related activities performed by agencies including U.S. Immigration and Customs Enforcement, Customs and Border Protection, the Executive Office for Immigration Review, the Department of State, and the Department of Labor.

That represents a considerable departure from the cost structure employers have historically associated with an individual H-1B filing.

Why This Matters for Employers

For companies that regularly sponsor employees through the H-1B cap, a six-figure filing fee could materially change the economics of workforce planning.

An employer filing five cap-subject petitions, for example, could face more than $516,000 in additional government fees if the proposal were finalized without changes. For employers with larger annual cap populations, fee totals could quickly reach into the millions.

DHS itself acknowledges the potential impact. In its regulatory analysis, the agency estimated that the rule would have a significant economic impact on 11,051 small entities, representing approximately 76% of the small entities it identified as having filed cap-subject H-1B petitions in FY 2025.

The proposal could therefore affect more than immigration budgets. HR and business leaders may need to consider how H-1B sponsorship fits into recruiting strategy, university hiring, workforce location decisions, and long-term retention planning.

This Is Separate From the Prior $100,000 H-1B Payment

Employers should also distinguish this proposal from the separate $100,000 H-1B payment imposed under a September 2025 Presidential Proclamation.

A federal district court vacated the agency guidance implementing that payment in June 2026, and the federal government has appealed. DHS expressly states that the newly proposed $103,265 fee relies on different statutory authority.

The proposed rule further provides that, if both payment requirements were ever simultaneously operative, an employer could potentially be required to pay both amounts. The Presidential Proclamation is presently scheduled to expire before the proposed fee would take effect unless it is extended or renewed. Some outlets report that legal commentators expect the new proposal’s statutory basis and characterization as a fee rather than a tax to receive substantial scrutiny if DHS ultimately finalizes the rule.

What HR and Business Leaders Should Do Now

Because the rule remains a proposal, employers do not need to change current filing practices or begin paying the $103,265 fee. They should, however, begin assessing what a final rule could mean for future hiring and immigration strategy.

• Model the financial impact. Determine how many cap-subject H-1B petitions your organization typically files and what a $103,265 per-petition increase would mean for annual workforce and immigration budgets.
• Identify employees and recruiting pipelines most exposed to the cap. University recruiting programs, F-1 employees working pursuant to Optional Practical Training, and other employees who will require an initial cap-subject H-1B petition deserve particular attention.
• Coordinate across HR, Finance, Legal, and business leadership. If finalized, this would no longer be simply an immigration-processing expense. Sponsorship decisions could require more senior-level budget and workforce planning.
• Review available immigration strategies early. Depending on the employee, position, nationality, corporate structure, and business needs, other lawful immigration classifications or longer-term permanent residence strategies may be available. Those options should be evaluated well before an employee reaches a critical immigration deadline.
• Consider participating in the rulemaking process. Employers and industry groups may submit comments through September 24, 2026. Organizations with data concerning recruiting, compensation, talent shortages, small-business impacts, or the effect of the proposed fee on U.S. operations may wish to consider whether submitting comments is appropriate.

The Bigger Takeaway

Even if the proposed fee is ultimately modified, delayed, or challenged, the proposal reinforces a broader trend: business immigration costs and compliance requirements are becoming increasingly important components of workforce strategy.

Companies that wait until an employee needs an H-1B filing may have fewer practical options than organizations that identify immigration-dependent talent well in advance and involve immigration planning in recruiting, budgeting, succession planning, and global mobility decisions.

For employers with significant H-1B populations or upcoming cap-dependent hiring needs, now is the time to review the organization’s exposure and consider contingency planning.

Klug Law Firm is closely monitoring the proposed rule and related litigation. Employers with questions about how the proposed $103,265 H-1B fee could affect their workforce strategy or upcoming sponsorship needs should contact our team to discuss their immigration program.