DHS Proposes $103,265 Fee for Lottery-Based H-1B Petitions

The Department of Homeland Security proposed a new $103,265 fee for each lottery-based H-1B filing on August 25, 2026. Technology companies are responding by placing more jobs abroad or delaying transfers to the United States.

The proposed surcharge applies to every cap-subject petition, the category used for the annual H-1B lottery. It would not apply to H-1B cases that are exempt from the numerical limit, such as those tied to universities and nonprofit organizations. This fee would be paid on top of existing government charges, which for a new cap-subject case in 2026 are commonly estimated at $2,225 to $3,595 before premium processing.

Employers Shift Work Abroad as Costs Rise

A sharp decline in initial consular filings shows how employers are already adjusting to rising sponsorship costs. The number of these filings fell from 13,823 in the prior year to just 1,212 between September 21, 2025 and May 24, 2026. This represents a drop of 91.2 percent.

Companies are preserving planned hires without immediately placing the person on a U.S. Payroll. They can assign the work to a foreign affiliate, establish the role in a country like Canada or India, or move functions such as engineering and support to another lower-cost country. This approach changes the timing of a potential U.S. Transfer rather than ending the hiring relationship outright.

The H-1B Lottery's Unchanged Structure

The H-1B system's basic numerical structure remains unchanged. Congress provides 65,000 regular places each year, plus an additional 20,000 for workers with qualifying U.S. Advanced degrees.

U.S. Citizenship and Immigration Services stated 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, with one summary reporting roughly 120,141 selections. The new fee therefore lands inside a system where employers already compete for a limited number of places.

A Quieter Shift in Where Work Begins

The result is a shift in where new work begins. Instead of moving every selected worker directly to the United States, some companies are keeping positions with overseas teams and postponing the U.S. Petition or transfer. This strategy is especially available for jobs that can be performed across borders.

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, such as those in STEM OPT status, may face a different calculation, as the cost of sponsoring a new lottery case has become a sharper factor in hiring decisions.

The annual allocation of 85,000 H-1B visas remains in place for the next cycle. The policy question, as outlined in the report, is whether companies will continue competing for those places at the same volume when a new filing could carry a $103,265 surcharge.