On August 25, 2026, the Department of Homeland Security (“DHS”) published a Notice of Proposed Rulemaking (NPRM) that would impose a $103,265 fee on H-1B cap-subject petitions.
The timing is not a coincidence. It comes one month after the First Circuit refused to let the government reinstate the $100,000 fee created by last September’s presidential proclamation, which we covered in our previous article.
After losing in court, DHS is now trying to get essentially the same money through a different legal door.
Proclamation 10973 (September 19, 2025) imposed a $100,000 payment on H-1B petitions for workers seeking to enter the U.S. from abroad, filed after September 21, 2025, using the President’s authority under INA §§ 212(f) and 215(a) to suspend or restrict entry. It included a discretionary national interest exception, and USCIS issued multiple rounds of guidance narrowing and clarifying who actually had to pay, the subject of [our October 2025 article.
That fee was challenged almost immediately. On June 8, 2026, Judge Leo Sorokin of the District of Massachusetts (*California v. Trump*) held that the $100,000 charge was an unlawful tax dressed up as an immigration entry restriction and vacated it. The government sought a stay pending appeal. On July 24, 2026, the First Circuit denied that request, the ruling which we covered in our prior post. As of today, USCIS and the State Department cannot collect the $100,000 payment on any petition and the proclamation itself is set to expire on September 20, 2026, unless renewed.
What the NPRM actually does
Rather than appeal its way back to the $100,000 fee, DHS is proposing to reach a nearly identical number through notice-and-comment rulemaking. That is a materially different legal foundation than a proclamation issued under the President’s entry-suspension power, and it is clearly deliberate: cost-recovery fee rulemaking is far more insulated from the “this is an unconstitutional tax on entry” argument that sank the proclamation.
A footnote in the notice shows the math behind the $103,265 figure: total costs to be recovered of roughly $8,777,488,350, divided by the projected 85,000 cap-subject petitions issued annually. Historically, USCIS fee rulemaking has been limited to recovering the cost of administering its own adjudications. Here, USCIS appears to be building in cost recovery for other federal agencies involved in the immigration system as well, including CBP, ICE, EOIR, DOS, and DOL. That is a meaningfully broader theory of “cost recovery” than USCIS has used before, and it is likely to be a central target of any comment or legal challenge. Expect a lawsuit to follow.
Key terms of the proposal
The NPRM is written to apply to cap-subject H-1B petitions generally, change-of-status cases included. That is a real departure from the $100,000 fee, which largely applied only to petitions for workers seeking to enter from outside the U.S. Workers already in the U.S. converting to H-1B status were largely outside its reach unless they failed to maintain status and had their case approved for consular processing. This proposal closes that gap.
The NPRM does not carry forward the national interest exception that gave employers, and DHS itself, an escape valve under the proclamation. Absent a comment-driven revision, this fee is proposed as a flat cost of any cap-subject H-1B petition, master’s exemption included.
Timing and next steps
Comments are due within 30 days of the August 25, 2026, Federal Register publication. This is a proposed rule, not a final one and there is no effective date yet. The amount, scope, or exemptions could change in the final rule based on comments received.
For now, nothing has changed. The $100,000 proclamation fee remains judicially blocked and uncollectable, and the $103,265 rule is not yet in force. But DHS has made its intent plain: this administration wants a six-figure H-1B fee, and if the courts take away the proclamation route, it will pursue the same outcome through rulemaking that is procedurally harder to unwind.
Conclusion
This is another attempt by the Trump administration to attack the H-1B program and make it harder for employers to sponsor foreign talent for one of the most sought-after visa categories in the country. Immigration-focused litigators are no doubt already gearing up to challenge this fee. But employers shouldn’t assume the comment period will change the outcome. The administration’s recent F-1 duration-of-status rulemaking showed that DHS will finalize a rule largely as proposed even over substantial public opposition.
If you have any questions regarding the above, please contact Chris Prescott at cprescott@psbplaw.com.