September 24, 2026. That’s the day public comments closed on DHS’s proposed rule to slap a $103,265 fee on every single H-1B cap-subject petition. Let that number sink in. This isn’t the same as the $100,000 proclamation fee a federal court already shut down earlier this year as an unlawful tax — this is a brand new proposal, and it’s still very much alive. If your company sponsors H-1B workers, or you’re hoping to land cap-subject status yourself, this rule could turn your hiring plans upside down. Waiting around isn’t a strategy. Understand your exposure now, and build a backup plan before this rule potentially becomes reality.
At Tez Law P.C., led by managing attorney JJ Zhang (California Bar #326666), our team is watching this situation closely — hour by hour, if we’re being honest. We’re helping employers and foreign nationals across the country figure out where they stand and what to do next. Below, we break down what this fee actually means, who gets hit hardest, and the concrete steps you should be taking right now. Protect your rights — we handle the rest.
Background: What This Means
Earlier this year, a presidential proclamation attempted to impose a $100,000 fee on H-1B petitions. A federal court struck down that fee, ruling it functioned as an unlawful tax that exceeded executive authority and violated the separation of powers embedded in immigration and tax law. Rather than abandoning the effort, DHS pivoted and issued a new proposed rule — this time seeking to impose a $103,265 fee specifically on H-1B cap-subject petitions through the formal rulemaking process under the Administrative Procedure Act (APA).
Unlike the earlier proclamation, which was issued unilaterally, this new fee proposal went through a formal notice-and-comment rulemaking process. DHS opened the docket for public comment, and thousands of employers, industry groups, universities, and immigration attorneys submitted objections before the window closed on September 24, 2026. Critics argue the fee is functionally identical to the fee already invalidated by the courts — merely repackaged through a different legal vehicle to survive judicial scrutiny. Immigration law organizations, including AILA, have signaled that legal challenges are all but certain if DHS finalizes this rule as proposed.
The stakes are high: the H-1B cap lottery already limits available visas to a small fraction of total demand each year. Layering a six-figure fee on top of an already competitive and expensive process could price out startups, small businesses, hospitals, universities, and mid-sized employers who rely on skilled foreign talent but lack the deep pockets of large technology corporations.
How This Affects Employers and Foreign Workers
If finalized, this rule would have sweeping consequences across nearly every industry that sponsors H-1B talent:
- Small and mid-sized employers may be forced to abandon H-1B sponsorship entirely, unable to absorb a $103,265 per-petition cost on top of existing legal, filing, and prevailing wage costs.
- Healthcare systems and hospitals that rely on H-1B physicians, nurses, and specialists in underserved areas could see critical staffing shortages worsen.
- Universities and research institutions may struggle to retain international scholars and researchers on H-1B status, even where cap exemptions don’t apply.
- Foreign national employees currently in F-1 OPT/STEM OPT status hoping to transition to H-1B could face employers unwilling or unable to pay the new fee, jeopardizing their ability to remain in the U.S. legally.
- Tech companies and startups competing for global talent may lose their competitive edge to companies abroad or shift hiring to remote international teams instead of U.S.-based H-1B roles.
Because this fee targets cap-subject petitions specifically, it could also distort employer behavior — pushing more reliance on cap-exempt categories, L-1 intracompany transfers, O-1 extraordinary ability visas, or other alternative pathways that don’t carry the same fee burden, at least for now.
What You Should Do Now
With legal challenges expected and the rule not yet finalized, employers and foreign workers should take a measured, proactive approach:
- Do not panic-file or make rash HR decisions. The rule is not yet final, and litigation is highly likely to delay or block implementation, just as it did with the earlier $100,000 proclamation fee.
- Audit your H-1B sponsorship pipeline. Identify which upcoming cap-subject petitions could be affected and build financial contingency plans now.
- Explore alternative visa categories such as O-1, L-1, TN, or cap-exempt H-1B opportunities where applicable, particularly for employees who may need a backup plan.
- Monitor the Federal Register and court dockets closely for updates on whether DHS finalizes the rule and whether injunctions or lawsuits halt its implementation.
- Consult an experienced immigration attorney before the H-1B cap registration period opens, so your strategy accounts for multiple possible outcomes.
Given the complexity and fast-moving nature of this issue, working with knowledgeable immigration services counsel is essential to protecting your workforce and your business operations nationwide.
Why Choose Tez Law P.C.
Tez Law P.C., based in West Covina, California, represents employers and individuals across the entire United States in complex, high-stakes immigration matters. Managing attorney JJ Zhang (California Bar #326666) and the Tez Law team stay ahead of rapidly shifting immigration policy — including proclamation fees, proposed DHS rulemaking, and the litigation that inevitably follows. We combine sharp legal strategy with clear, practical guidance so employers and foreign nationals alike can make confident decisions even amid regulatory uncertainty. Whether you need help evaluating H-1B alternatives, preparing for cap season, or understanding how a potential injunction could affect your case, our firm is ready to guide you every step of the way. We also proudly assist clients through our personal injury attorney team for those facing unrelated injury claims, reflecting our commitment to comprehensive, client-centered legal service.
Frequently Asked Questions
Is the $103,265 H-1B fee currently in effect?
No. As of September 25, 2026, the proposed rule remains under review following the close of the public comment period on September 24, 2026. DHS must review comments and issue a final rule before any fee could take effect, and legal challenges are widely expected to delay or block implementation.
How is this different from the $100,000 proclamation fee that was struck down?
The earlier $100,000 fee was imposed through a presidential proclamation and was struck down by a federal court as an unlawful tax exceeding executive authority. The new $103,265 fee is being pursued through formal DHS rulemaking under the Administrative Procedure Act, a different legal process that proponents argue may withstand judicial scrutiny — though critics expect similar legal challenges.
What should my company do if we plan to sponsor H-1B workers for the next cap season?
Start by auditing your current and planned H-1B sponsorships, exploring alternative visa categories as contingency options, and consulting an immigration attorney to build a flexible strategy that accounts for multiple possible regulatory outcomes before the registration period opens.
Immigration policy is shifting fast, and the consequences for employers and foreign workers nationwide could be significant. Don’t wait until the rule is finalized to figure out your next move — contact Tez Law P.C. today for a free consultation and let our experienced team help you navigate the H-1B cap fee uncertainty with clarity and confidence.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Contact Tez Law P.C. at 626-678-8677 or [email protected] for advice specific to your situation. Results may vary.