1. Understanding the Two Stages of the H-1B Process

To understand the proposed H1B visa fee, employers should first understand the two basic stages of the annual H-1B process. The first stage is registration. The registration fee is $215 per beneficiary, and it is paid at the registration stage. An employer registers a worker it wants to sponsor for the annual H-1B selection process. Because the number of registrations is usually higher than the annual statutory cap of 85,000 available H-1B visas, USCIS uses a lottery system when registrations exceed that number.

The second stage begins only if the worker is selected. At that point, the employer may file the actual H-1B petition with USCIS. The proposed $103,265 fee would apply at this second stage.

In simple terms:

• If the worker is not selected in the H1B lottery: the employer would not pay $103,265.
• If the worker is selected but the employer decides not to file the H-1B petition: the employer would not pay $103,265.
• If the worker is selected and the employer files the H-1B petition: the employer would pay the proposed $103,265 fee.
• If USCIS later denies the petition: the proposal does not create a special right to a refund simply because the case was denied.

This is why it would be misleading to describe the proposal as a $103,265 lottery fee. It is not a payment for entering the lottery. It is a proposed fee connected to the filing of the actual H-1B petition after selection. Employers following H1B visa lottery results should therefore understand that selection itself does not automatically create the fee. The fee would arise only if the employer moves forward with the actual filing.

2. Would the Employer Pay $103,265 for Each Worker?

Yes. The proposed rule does not create one annual $103,265 payment for each employer. The fee would apply separately to each H-1B petition that is subject to the annual cap.

For example, assume a company registers three workers: Daniel, Adrian, and Selena. If Daniel is not selected, the employer would not pay the $103,265 fee for him. If Adrian is selected but the employer later decides not to file his H-1B petition, the employer would not pay the fee for him either. If Selena is selected and the employer files the actual petition, the employer would pay the proposed $103,265 fee for Selena's case.

If all three workers are selected and the company files H-1B petitions for all three, the proposed fee alone would be: 3 × $103,265 = $309,795

The H-1B process already involves mandatory government filing fees and multiple fees that typically total about $2,225 to $3,595 before any proposed $103,265 charge, including the $780 basic USCIS filing fee, the $500 anti-fraud fee, the ACWIA Training additional fee of $750 for small employers or $1,500 for larger employers, and the Asylum Program Fee of $300 to $600, with the exact fee applies based on employer size and type. A separate $4,000 fee applies to employers with 50 or more employees when most are in H-1B or L-1 status. For employers filing multiple new H-1B cases, the financial impact could therefore be substantial.

3. Who Would Pay the Fee: the Worker or the Employer?

Under the DHS proposal, the employer would be responsible for paying the fee, and the sponsoring employer is generally responsible for most H-1B visa fees as a business expense under federal regulation. In the H-1B system, the U.S. employer files the petition. The foreign worker does not independently file the H-1B petition on his or her own behalf. The proposed fee is therefore tied to the employer's filing. Legal fees for preparing the petition are also typically the employer's responsibility under immigration law.

DHS also notes that H-1B employers already have wage-related obligations toward sponsored workers. The Department appears to assume that employers using the H-1B program have the resources necessary to absorb additional sponsorship costs. This point is important because the proposed H1B visa fee could materially change the cost to hire foreign workers for the first time under the H-1B cap.

4. Why Is the Proposed H1B Visa Fee So High?

The proposed $103,265 amount is not based only on the direct cost of reviewing one H-1B petition. DHS is seeking to generate approximately $8.78 billion in annual revenue to support broader immigration-related government costs, and a proposed $100,000 fee for H-1B applications is under review as part of the rulemaking process.

The Department assumes that approximately 85,000 H-1B petitions per year would be subject to the new fee. DHS then divided approximately $8.777 billion in projected costs by 85,000 petitions. That produced a figure of approximately $103,264.57, which DHS rounded to $103,265.

This calculation is important because the money would not be used only by USCIS. The proposed revenue could help cover immigration-related costs involving several federal agencies, including: USCIS, Immigration and Customs Enforcement, Customs and Border Protection, the immigration court system, the U.S. Department of State, and the Department of Labor. DHS says the charge would help support lawful immigration programs and recover broader costs incurred across the United States immigration system tied to lawful immigration programs.

This may become one of the most important legal issues if the rule is finalized. A future court may be asked:

Can the government charge an H-1B employer $103,265 for one worker's petition in order to finance costs that extend far beyond the processing of that individual H-1B case?

That issue could become central to future H1B policy litigation.

5. Who Could Be Required to Pay the $103,265 Fee?

If the rule is finalized in substantially its current form, it would primarily affect employers sponsoring workers for H-1B status through the annual cap for the first time. The overall annual statutory cap is 85,000, made up of the 65,000 regular cap plus the 20,000 advanced-degree exemption. There is also a separate exemption for up to 20,000 workers who have earned qualifying U.S. master's degrees or higher degrees. The proposed rule would also apply to this advanced-degree group.

Therefore, a worker who earned a master's degree in the United States should not assume that the proposed H1B visa fee would not apply. If the worker must go through the annual H-1B cap process and the employer files the petition after selection, the proposed fee could apply. H-1B petitions are for jobs in a specialty occupation, which generally requires at least a bachelor's degree or equivalent experience and the theoretical and practical application of specialized knowledge.

6. Why Are F-1 Students and OPT Workers Especially Important?

One of the biggest effects of the proposal could be on foreign students who graduate from U.S. universities and work under Optional Practical Training, commonly known as OPT. Many of these individuals are in F-1 student visas status before moving into H-1B employment.

For example, assume a Turkish student completes a master's degree in the United States and begins working for a technology company under OPT. The company later registers that employee for the H1B lottery. If the worker is not selected, the employer would not pay the $103,265 fee. If the worker is selected and the employer files the first H-1B petition, the employer could be required to pay the proposed $103,265 fee if the rule becomes final.

This means the proposal is not limited to workers living outside the United States. It could directly affect international graduates who are already living, studying, and working in the United States. That could be particularly important in technology, engineering, healthcare, finance, science, and research. For many employers, the new fee could influence whether they are willing to move a foreign graduate from OPT into H1B status.

7. Would the Fee Apply When an H-1B Worker Changes Employers?

In general, no. A worker who has already been counted against the annual H-1B cap normally does not have to go through the annual lottery again simply because he or she moves to a new employer. Similarly, extending an existing period of H-1B employment normally does not require the worker to be counted against the annual cap again.

Therefore, the most important question is not simply: “Is a new H-1B petition being filed?” The better question is: “Is this worker being counted against the annual H-1B cap again?”

If the answer is no, the proposed $103,265 fee would generally not apply. This distinction is important for current H-1B workers who are considering changing employers. In many cases, a cap-counted worker moving to another company is generally dealing with a transfer rather than a fresh cap-subject case, though maintaining status still depends on timely filing and continued compliance. The proposed rule should not be understood as imposing a $103,265 fee on every H-1B filing.

8. What About Universities and Research Organizations?

Certain employers are exempt from the normal annual H-1B cap. Examples include universities, certain nonprofit organizations connected to universities, qualifying nonprofit and research based institutions, and government research organizations.

DHS is proposing that the $103,265 fee apply to H-1B petitions that are subject to the annual cap. Therefore, employers that are normally exempt from the annual H-1B cap generally would not be the primary target of the proposed fee. This distinction could become very important for universities, medical institutions, and research organizations that regularly sponsor H-1B workers.

9. Would the Fee Be Refunded if USCIS Denies the H-1B Petition?

Employers should pay particular attention to this issue. The proposed rule does not state that an employer would automatically receive the $103,265 back if USCIS later denies the H-1B petition. USCIS filing fees are generally paid for the government to accept, review, process, and decide a petition. They are not payments for a guaranteed approval. Therefore, USCIS generally does not refund filing fees simply because a petition is denied, which is a common rule for H-1B petition fees.

Limited exceptions may exist in situations involving agency error or improper collection. These filing fees are generally non refundable even when there is no visa approval.

If the rule is finalized as proposed, an employer could therefore: pay $103,265, file the H-1B petition, and later receive a denial.

The employer could then lose both the opportunity to employ the worker in H-1B status and the substantial filing fee. Paying the proposed H1B visa fee would not guarantee approval of the H-1B petition.

10. What Happened to the Prior $100,000 H-1B Rule?

To understand the current proposal, it is useful to look at the prior H1B 100k fee introduced in 2025. On September 19, 2025, President Donald Trump issued Presidential Proclamation 10973. The proclamation conditioned the entry of certain new H-1B workers into the United States on an employer making a $100,000 payment for certain new H-1B petitions filed after September 21, 2025.

The policy took effect on September 21, 2025. It was not required for H-1B renewals. It was designed to remain in effect for approximately 12 months unless extended. Like the new proposal, the prior $100,000 payment was not a fee simply to enter the H1B lottery. For certain H-1B cases, employers had to pay before filing the petition, and the fee applies only if proof of payment was included with the filing for the intended employment.

The prior policy was aimed mainly at certain new H-1B workers who were outside the United States and seeking to enter in H-1B status. It did not automatically invalidate previously issued visas or earlier H-1B approvals.

11. Why Was the $100,000 H-1B Rule Challenged?

Twenty states filed a federal lawsuit challenging the $100,000 requirement. The case was: State of California et al. v. Mullin The lawsuit was filed in the U.S. District Court for the District of Massachusetts. The plaintiff states included California, Massachusetts, New York, and New Jersey. Their main argument was that the President and federal agencies had imposed an extremely large financial burden on H-1B employers without clear authority from Congress.

On June 8, 2026, federal judge Leo T. Sorokin ruled in favor of the states. The court vacated the federal agency actions that implemented the $100,000 policy. In practical terms, the policy could no longer continue to operate in the same way.

12. Why Did the Court View the $100,000 Payment as Similar to a Tax?

This part of the case is especially important for understanding today's H1B visa news. The Administration argued that the $100,000 payment was connected to immigration enforcement and the President's authority to restrict entry into the United States. The court, however, focused on the size and nature of the financial burden. It concluded that the payment looked more like a tax or a revenue-raising financial charge than an ordinary immigration condition. The court reasoned that if the executive branch wants to impose a financial burden of that size, Congress must have clearly authorized it.

The Presidential Proclamation relied mainly on laws that give the President broad authority to restrict or suspend the entry of certain foreign nationals. Those laws do provide significant immigration authority. But the court found a serious problem: They did not clearly state that the President could impose a new $100,000 charge on H-1B employers.

The First Circuit later emphasized a similar point. When Congress wants immigration-related fees to be collected, Congress often says so expressly in the law. The challenged payment also affected a visa category for an alien worker in specialty occupations that typically require a bachelor's degree or equivalent experience under the Immigration and Nationality Act.

Put simply, the legal problem was: The President's power to restrict entry into the United States does not automatically include the power to impose a new $100,000 financial charge. That was one of the major weaknesses of the prior H1B 100k fee.

13. What Happened After the Government Lost the Case?

The federal government appealed the decision to the U.S. Court of Appeals for the First Circuit on June 11, 2026. The government also asked the appellate court to temporarily suspend the Massachusetts ruling while the appeal continued. If that request had been granted, the $100,000 payment requirement could have resumed during the appeal.

The First Circuit denied the request on July 24, 2026. The court concluded that the government had not made the required strong showing that it was likely to win the appeal. The issue of whether Congress had clearly authorized the President to impose such a large financial payment remained a serious legal concern.

As a result, as of August 27, 2026, the prior $100,000 payment requirement is not being collected. The underlying appeal, however, has not yet been finally decided. DHS itself discusses the prior litigation in the new $103,265 proposal. The 2025 Presidential Proclamation was also written to last approximately 12 months and is expected to expire around September 21, 2026 unless extended or renewed.

14. Is the New $103,265 Fee the Same as the Prior $100,000 Rule?

No. The amounts are similar, but the legal structure is different. The prior $100,000 requirement came through a Presidential Proclamation. The government relied mainly on the President's authority to restrict the entry of foreign nationals.

The new $103,265 proposal takes a different route. DHS is attempting to establish the amount as an official H1B visa fee through the normal federal rulemaking process. This time, DHS is expressly relying on federal laws that authorize the government to charge fees for immigration services under broader immigration law authority. One of the key provisions cited by DHS is 8 U.S.C. § 1356(m). That law gives the government authority to establish immigration fees intended to recover the costs of providing immigration and naturalization services. That framework also sits within the Immigration and Nationality Act.

This is a major legal difference. In the earlier case, the question was essentially: “Did Congress give the President authority to impose this type of financial charge?”

Under the new proposal, DHS is arguing: “Congress has already given the Department authority to establish immigration-related fees.” That may give the new proposal a stronger legal foundation than the prior $100,000 rule. But that does not mean the new rule would automatically survive a lawsuit.

15. Could the New H1B Visa Fee Be Challenged in Court?

Yes. If DHS finalizes the rule, legal challenges would be quite possible. Employers, business associations, universities, and other organizations affected by the fee may challenge it. The legal question, however, would likely be different from the question in the $100,000 case. The old case focused mainly on whether the President had authority to impose the charge.

A future lawsuit involving the $103,265 fee could ask:

Even if DHS has authority to charge immigration fees, does that authority allow the Department to charge H-1B employers more than $100,000 per worker in order to fund much broader immigration-system costs?

That could become one of the most important questions in future H1B policy litigation.

A court could examine issues such as:

• whether there is a reasonable connection between the fee and the service provided;
• whether H-1B employers can legally be required to fund costs associated with other immigration programs;
• whether DHS used a reasonable method to calculate the $103,265 amount;
• whether DHS adequately considered public comments;
• whether DHS properly analyzed the burden on small businesses.

DHS's own economic analysis recognizes that the proposal could have a serious effect on small employers. The Department estimates that approximately 11,051 small businesses, or about 76% of the small businesses analyzed, could experience a significant economic impact. This is one reason the proposed fee could have broader consequences for the H-1B visa impact on U.S. jobs. If the fee makes H-1B sponsorship economically unrealistic for smaller employers, large companies may be better positioned to continue sponsoring foreign talent than smaller competitors.

16. Could the Prior $100,000 Fee and the New $103,265 Fee Apply at the Same Time?

Theoretically, yes. DHS states in the new proposal that if an employer is subject both to a payment required under a Presidential Proclamation and to the new $103,265 fee, the employer would have to make both payments separately. That is not the situation today. The prior $100,000 requirement is not currently being enforced because of the federal court ruling.

However, suppose the government ultimately wins the appeal, the prior policy becomes enforceable again, or a similar policy is renewed. If the new $103,265 fee also becomes final, it is theoretically possible for both charges to apply to the same case.

The additional federal cost could then reach: $100,000 + $103,265 = $203,265

Normal H1B visa fees would still be separate. This is only a hypothetical possibility. Employers are not currently required to pay both amounts.

17. When Could the New H1B Visa Fee Take Effect?

There is currently no definite effective date. The August 25, 2026 publication is a proposed rule. It is not a final rule. The public comment period is scheduled to end on September 24, 2026.

After that date, DHS will review the comments. The Department could revise the proposal, issue a final rule, delay action, or withdraw the proposal. If DHS publishes a final rule, that rule will state when the new H1B visa fee becomes effective.

DHS has modeled the financial impact beginning in Fiscal Year 2027. That does not mean the fee will automatically begin on October 1, 2026. The actual effective date will not be known until DHS issues a final rule.

Therefore: Employers do not currently have to pay the $103,265 fee. This point is especially important because headlines such as “new H1B fee” or “H1B visa fees increase to $103,265” could give readers the false impression that the payment is already mandatory. It is not.

18. What Should Employers Do Now?

Employers should not automatically cancel their H-1B plans because of a proposed rule, though any exceptions if one is adopted would likely be limited to rare certain circumstances. At the same time, companies should begin evaluating the possible financial consequences if the rule becomes final.

This is especially important for employers that:

• employ international graduates under OPT;
• regularly participate in the H1B lottery;
• sponsor multiple new H-1B workers each year;
• have limited immigration budgets;
• operate as small or mid-sized businesses.

For example, if an employer files five cap-subject H-1B petitions after the proposed rule takes effect, the new fee alone could total: $516,325

For ten employees, the proposed fee alone could total: $1,032,650

At those levels, H-1B sponsorship could become much more than an immigration filing decision. It could become a major recruiting, budgeting, and workforce-planning decision.

Separate from that proposed charge, premium processing is optional for most H-1B petitions, including extensions, and costs $2,805. USCIS guarantees action within 15 calendar days and refunds that fee if it does not act in time. Either the employer or the employee may pay that fee, depending on whether expedited handling is sought for business needs or personal reasons.

Employers should also be cautious when reading fast-moving immigration news today. The proposed $103,265 fee is not currently in effect, and the prior $100,000 payment is not currently being collected. Likewise, reports suggesting that large numbers of H1B visas cancelled because of this new proposal would be inaccurate. A proposed filing fee does not automatically cancel existing H-1B visas or existing H1B status.