The cost of hiring a skilled foreign worker in the US could jump into six figures, with the Department of Homeland Security (DHS) proposing a $103,265 fee for every H-1B petition subject to the annual cap.
The proposal is significant for Indian professionals because the H-1B programme is a major route for skilled workers, particularly in technology, engineering, finance and other specialised occupations, to work in the US.
But there is an important distinction: this is a proposed employer-side fee, not a $103,265 bill that an H-1B worker will personally receive. And it is not in force yet. The proposal now enters the public-comment and rulemaking process.
Who would have to pay the $103,265?
The proposed fee would apply to all H-1B cap-subject petitions, including:
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The regular 65,000 annual H-1B cap -
The additional 20,000 slots for people with qualifying US master’s degrees or higher -
Petitions filed under the advanced-degree exemption
Someone who completes a US master’s degree, works under F-1 OPT and is subsequently selected in the H-1B lottery could have an employer facing the proposed six-figure fee when the H-1B petition is filed.
The fee would be in addition to existing H-1B filing fees and other applicable payments.
However, cap-exempt H-1B petitions would not be covered. This includes many petitions filed by institutions of higher education, affiliated nonprofit organisations, nonprofit research organisations and governmental research organisations.
It does NOT mean every H-1B worker will suddenly cost $103,265
The proposed charge is tied to the annual H-1B cap, rather than every H-1B filing.
That means it would not automatically apply to every H-1B extension, transfer or cap-exempt petition. The key question is whether the particular petition is subject to the annual numerical cap.
It also does not change the status of H-1B petitions that have already been approved.
Why exactly $103,265?
DHS has come up with a remarkably precise number.
The agency estimates that the federal government incurs about $8.78 billion a year in costs associated with administering the lawful immigration system. It divided that amount by an assumed 85,000 cap-subject H-1B petitions annually, producing approximately $103,265 per petition.
If all 85,000 available slots are used, DHS estimates the fee could generate approximately $8.8 billion a year.
The money would not simply go to USCIS. DHS proposes distributing the revenue across several agencies involved in the immigration system:
Agency Proposed annual allocation
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USCIS $3.0 billion -
Executive Office for Immigration Review $2.96 billion -
Department of Labor $1.21 billion -
Immigration and Customs Enforcement $1.05 billion -
Department of State $484 million -
Customs and Border Protection $76.2 million
DHS says the funding would support activities including immigration adjudication, fraud detection, national-security vetting, immigration courts, consular processing, labour enforcement and systems modernisation.
The big question: will employers actually pay?
This is where the proposal could have its biggest impact.
Historically, employers have generally faced H-1B filing costs in the thousands of dollars, depending on the employer and the type of petition. A $103,265 additional charge changes the economics dramatically.
For a large technology company hiring hundreds of specialised workers, the cost could run into millions of dollars. For a startup, smaller technology company, hospital or other employer with a limited recruitment budget, the decision to sponsor an H-1B worker could become considerably harder.
DHS itself acknowledges the potential impact on smaller businesses. The proposal’s economic analysis identifies thousands of small entities that could be affected.
That could lead employers to reconsider whether to sponsor an overseas candidate, hire someone who already has work authorisation, shift certain roles outside the US or increase salaries to compensate for the scarcity of sponsorship opportunities.
For Indian IT companies that use the H-1B programme to place specialised employees in the US, the proposal could therefore add another layer of cost to an already closely watched immigration route.
This is separate from the earlier $100,000 H-1B fee
The proposed $103,265 fee is legally separate from the $100,000 payment requirement introduced by the Trump administration in 2025.
That earlier measure was established through a presidential proclamation and has been challenged in court. A federal district court in Massachusetts vacated the guidance implementing that payment requirement in June 2026, and the government’s appeal remains pending.
DHS says the new proposal relies on a different statutory authority.
And, crucially, the proposal says that if an employer were subject to both requirements, both payments could potentially be required.
That creates a theoretical scenario in which the cost could exceed $200,000 per petition, although the legal status and timing of the earlier $100,000 measure remain separate issues.
Immigration lawyers expect a legal fight
“Given the scope of the proposal and the ongoing litigation surrounding the administration’s previous H-1B fee policy, we expect this rule to face significant legal challenges if DHS moves forward with a final regulation.
It’s also important to remember that this is only a proposed rule.
DHS must first complete the public comment process and determine whether to issue a final regulation, and no implementation date has been announced.
Importantly, the proposed rule is directed at future H-1B cap-subject filings and would not affect petitions that have already been approved. No changes would take effect until DHS ultimately finalizes the rule.
As a result, employers should continue working closely with their immigration counsel and avoid making workforce decisions based on the proposal alone,” said Peter Bade, Managing Attorney at Corporate Immigration Partners.
The American Immigration Lawyers Association (AILA) called the proposed fee an “exorbitant” charge and argued that it could prevent employers from using H-1Bs for critical positions, including teachers, researchers, rural doctors and clergy. “This exorbitant fee to participate in the H-1B program would shut out employers that use H-1Bs to fill job openings for essential staff like teachers, researchers, rural doctors, and clergy. To be clear, this proposed rule is an unprecedented move to fund adjudications of legal immigration processing at various federal agencies without specific congressional authorization and comes after the Trump Administration’s first attempt to tax H-1B employers bringing in new employees from overseas did not raise the expected revenue and was deemed unlawful by federal courts. This is executive overreach on steroids, and Congress and the courts must act,” said Jeff Joseph, President of the American Immigration Lawyers Association (AILA).
Cato Institute immigration policy analyst David Bier has also challenged DHS’s cost-recovery argument, pointing to the legal battle surrounding the previous $100,000 charge and arguing that such a fee could be prohibitive for employers.
So, can Indian students and H-1B aspirants panic?
Not yet.
The $103,265 charge is not currently payable. DHS must go through the federal rulemaking process, accept and review public comments and decide whether to issue a final regulation.
The proposal provides for a 30-day public-comment period after publication in the Federal Register. The American Hospital Association, for example, said comments are due by September 24.
Until a final rule is published with an effective date, employers should not treat the $103,265 amount as an existing H-1B cost.
But the direction of policy is significant.
For an Indian student planning the familiar US master’s degree → OPT → H-1B route, the proposed rule does not impose a personal $103,265 payment. Instead, it could make the student’s future employer far more selective about sponsoring a cap-subject H-1B.
And that may ultimately be the bigger issue: the proposal could raise the cost of accessing the H-1B lottery without directly raising the fee paid by the foreign worker.
What happens next?
The proposed rule is scheduled for Federal Register publication on August 25, 2026, after which the public-comment period will begin. DHS will then have to consider the feedback before deciding whether to issue a final rule.
For now, nothing changes for existing H-1B holders or already-approved petitions. For future applicants, particularly those competing for the 65,000 regular slots or 20,000 US master’s exemption slots, the bigger question is whether employers will remain willing to absorb a six-figure sponsorship cost.
