Trump administration proposes $103,265 H-1B fee for workers already in US
DHS says the fee would raise $8.8B a year, while its own analysis finds a significant hit to 76% of affected small employers.
By Ryan Merket · Published
Primary source: Bloomberg
Why it matters
The proposal would make first-time H-1B sponsorship a six-figure hiring decision, shifting foreign graduates toward employers with the deepest balance sheets.
The Trump administration proposed a $103,265 fee for every cap-subject H-1B petition, expanding its six-figure charge to employers sponsoring people already in the United States, including recent graduates moving from student status into their first H-1B job.
The Department of Homeland Security filed the proposed rule for publication on August 25th, a day after Bloomberg reported its scope. The fee is still a proposal and is not currently owed. The public has 30 days after publication to submit comments. (public-inspection.federalregister.gov)
If finalized as written, employers would pay the charge when filing a selected cap petition, on top of existing filing and statutory fees. The annual H-1B cap covers 65,000 workers, plus 20,000 people with advanced degrees from US institutions. (public-inspection.federalregister.gov)
The small-employer hit is in DHS's own numbers
The proposal would apply uniformly across cap-subject employers, regardless of their size. Cap-exempt petitions filed by certain universities, nonprofit research organizations and government research organizations would remain outside the new fee. (public-inspection.federalregister.gov)
That leaves startups directly exposed. DHS identified 28,649 unique employers that filed initial cap-subject petitions in fiscal 2025. It classified 14,541, or 51%, as small entities, while another 5,350 could not be classified because the agency lacked sufficient revenue, employee or industry data. (public-inspection.federalregister.gov)
DHS estimates the charge would have a significant economic impact on 11,051 small employers, equal to 76% of the small entities in its analysis. The department defined a significant impact as a cost exceeding 1% of annual revenue. It rejected exemptions or discounts for smaller companies, arguing that those measures could encourage employers to structure themselves to avoid the fee and would reduce the expected revenue. (public-inspection.federalregister.gov)
The same rule says DHS believes cap-subject employers are "willing to pay and can afford" the additional $103,265. That assertion sits beside the department's finding that the fee would materially affect thousands of small businesses. (public-inspection.federalregister.gov)
For a large technology company, the charge adds another line to a recruiting budget. For a venture-backed startup hiring one specialized engineer, it turns a visa petition into a six-figure capital allocation before the government decides the case. The policy would give companies with larger balance sheets a structural advantage in the competition for foreign graduates already working in the US.
A regulatory do-over after a court defeat
The proposal follows the administration's failed attempt to create a similar charge through presidential authority. President Donald Trump issued a September 19th, 2025 proclamation requiring a $100,000 payment for certain H-1B workers outside the United States. That restriction took effect on September 21st, 2025. (whitehouse.gov)
On June 8th, a federal judge in Massachusetts vacated the policy, finding that the administration had imposed a tax without authority delegated by Congress. The administration appealed, but the First Circuit denied its request to keep collecting the fee on July 24th while the appeal proceeds. (ag.ny.gov)
DHS is using a different legal route this time. The new plan is moving through notice-and-comment rulemaking and cites the Immigration and Nationality Act's provisions allowing the department to set fees that recover immigration adjudication and naturalization costs. The proposal explicitly says it rests on different authority from the 2025 proclamation. (public-inspection.federalregister.gov)
The American Immigration Lawyers Association called the proposal "essentially a tax" and argued that using H-1B petitions to finance work across several agencies lacks specific congressional authorization. That objection points to the likely center of any legal challenge if DHS finalizes the rule. (aila.org)
The $8.8B revenue target
DHS arrived at $103,265 by dividing $8.777 billion in government costs by 85,000 projected fee-paying petitions, then rounding the result to the nearest $5. The department expects the charge to generate about $8.8 billion each year. (public-inspection.federalregister.gov)
USCIS would receive 34.2%, or $3 billion. The Executive Office for Immigration Review, which operates the immigration courts, would receive 33.7%, or nearly $2.96 billion. The rest would flow to Immigration and Customs Enforcement, Customs and Border Protection, the State Department and the Labor Department. (public-inspection.federalregister.gov)
The calculation assumes exactly 85,000 paid petitions. USCIS received an average of 96,750 cap-subject petitions annually between fiscal 2021 and 2025 because it selects extra registrations to account for denials, withdrawals and rejected filings. DHS assumes the six-figure fee would reduce properly filed petitions to 85,000 while leaving enough demand to fill the statutory cap. (public-inspection.federalregister.gov)
That revenue model depends on employers continuing to sponsor workers at roughly the program's full capacity. DHS is betting that demand for specialized labor will survive a fee large enough to eliminate many smaller bidders. The result would preserve the H-1B cap while changing which employers can afford to compete for it.