- DHS proposed a $103,265 fee for each lottery-based H-1B filing on August 25, 2026.
- The surcharge applies to cap-subject petitions, but not to university or nonprofit cap-exempt cases.
- Employers are shifting work abroad as H-1B sponsorship costs rise above existing government fees.
The Department of Homeland Security proposed a new charge on August 25, 2026, that would add $103,265 to each lottery-based H-1B filing, including petitions using the U.S. master's exemption. Technology companies are responding by placing more jobs abroad or delaying U.S. transfers.
The proposed surcharge would apply to every cap-subject petition, the category used for annual lottery cases. It would not cover H-1B cases exempt from the numerical limit, including filings tied to universities and nonprofit organizations.
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The change would sharply widen H-1B sponsorship costs. Ordinary government charges for a new cap-subject case are commonly estimated at $2,225 to $3,595 in 2026, before premium processing, with the total varying by employer size and available exemptions.
Employers would pay the proposed amount on top of those existing costs. The Department of Homeland Security's proposal is aimed at new H-1B visas for highly skilled foreign workers and would make the added charge permanent.
A drop in initial consular filings already shows how employers are adjusting. The number fell from 13,823 in the prior year to 1,212 between September 21, 2025 and May 24, 2026, a decline of 91.2%.
The lottery still offers 85,000 annual places
The H-1B system has not changed its basic numerical structure. Congress provides 65,000 regular places each year, plus 20,000 additional places for workers with qualifying U.S. advanced degrees.
| H-1B allocation | Annual places |
|---|---|
| Regular cap | 65,000 |
| U.S. advanced-degree exemption | 20,000 |
| Combined total | 85,000 |
U.S. Citizenship and Immigration Services said on March 31, 2026, that it had received enough registrations to reach the FY2027 allocations. The earlier FY2026 cycle drew 343,981 registrations from 336,153 unique beneficiaries, while one summary reported roughly 120,141 selections.
The fee therefore lands inside a system where employers already compete for a limited number of places. A company can incur the new charge only after deciding that a particular worker and role justify entering that process.
Overseas teams are becoming the cheaper first move
Companies can preserve a planned hire without immediately placing the person on a U.S. payroll. They can assign the work to a foreign affiliate, establish the role in Canada or India, or move engineering and support functions to another lower-cost country.
That approach changes the timing rather than necessarily ending the hiring relationship. An employer may hire abroad first and consider a U.S. transfer later, if the business case supports the added expense.
The pattern is most visible in net-new U.S. placements. Large hiring pipelines that depend on repeated lottery filings face the surcharge at scale, making each unsuccessful or deferred placement more expensive to plan around.
Workers already in the United States may face a different calculation. Employers can still hire people in STEM OPT or another status, but the cost of sponsoring a new lottery case has become a sharper factor in that decision.
The distinction also separates the proposal's reach from the entire H-1B program. University and nonprofit cases that qualify for cap exemption would not enter the annual lottery category targeted by the surcharge.
The result is a quieter shift in where work begins. Instead of moving every selected worker directly to the United States, some companies can keep the position with an overseas team and postpone the petition or transfer.
That strategy is especially available for jobs that can be performed across borders. It is less useful where the work requires a U.S. presence, but the proposed charge gives employers a reason to test whether that presence is necessary before filing.
The annual allocation remains in place for the next cycle. The policy question is whether companies will continue competing for those places at the same volume when a new filing could carry a $103,265 surcharge.
