U.S. Immigration Alerts

FGI Alert: DHS Proposes Permanent $103,265 H-1B Fee, Potentially Expanding Costs for OPT-to-H-1B Sponsorship

The Trump Administration has proposed a new $103,265 fee for every cap-subject H-1B petition, potentially creating a permanent and substantially broader replacement for the $100,000 payment imposed by President Trump’s September 2025 proclamation. The proposal is not a renewal of the earlier proclamation-based payment. Instead, the Department of Homeland Security (DHS) is attempting to establish the charge through the federal regulatory process, including notice and public comment, after a federal court vacated the government’s implementation of the original $100,000 payment. If ultimately adopted, the proposal could dramatically increase the cost of sponsoring foreign graduates currently working in the United States in F-1 Optional Practical Training (OPT) or STEM OPT, including graduates seeking an in-country change of status to H-1B. 

Key Points 

• The Original $100,000 Payment Is Not Currently Enforceable: President Trump’s September 19, 2025 proclamation imposed a $100,000 payment on certain new H-1B petitions and was scheduled to apply through September 20, 2026, unless extended. However, the U.S. District Court for the District of Massachusetts vacated the government’s implementation of the payment requirement on June 8, 2026, and the U.S. Court of Appeals for the First Circuit denied the government’s request to stay that ruling on July 24, leaving the vacatur in effect while the appeal continues. 

• DHS Is Proposing a New $103,265 Fee: DHS has now proposed a $103,265 supplemental fee for H-1B petitions subject to the annual statutory cap, including petitions filed under the 20,000 U.S.-master’s-degree exemption. The proposed charge would be paid at the time of filing and would be in addition to the existing H-1B filing and other applicable government fees. 

• The Proposal Is Broader Than the 2025 Proclamation: Unlike the previous proclamation-based payment, which primarily affected certain H-1B workers being hired from outside the United States, the proposed regulatory fee would apply to cap-subject petitions regardless of whether the beneficiary is already in the United States. Consequently, an employer could potentially face the $103,265 fee when requesting an F-1-to-H-1B change of status for an employee working in the United States on OPT or STEM OPT. 

• The Fee Would Not Apply to OPT Simply Because a Student Has OPT: The proposed H-1B charge would arise when an employer files a covered cap-subject H-1B petition; it would not be a $103,265 fee imposed merely because an F-1 student participates in OPT or STEM OPT. A separate policy issue concerns the Administration’s treatment of OPT, but that should not be confused with the proposed H-1B fee. 

• The Proposal Is Not Yet Law: DHS must complete the notice-and-comment process and issue a final rule before USCIS could begin collecting the new fee. The proposed rule is scheduled for publication in the Federal Register on August 25, 2026, beginning a 30-day public-comment period. 

What U.S. Employers Need To Know 

• Employers Sponsoring OPT Graduates Could Face a Major New Cost: If the proposal is finalized as written, an employer sponsoring an OPT or STEM OPT employee through the annual H-1B selection process could be required to pay the $103,265 supplemental fee in addition to the ordinary H-1B filing fees. This would apply even where the employer requests that the employee change status from F-1 to H-1B inside the United States, rather than requiring the employee to obtain H-1B visa processing abroad. 

• The U.S.-Master’s Cap Would Not Escape the Fee: The proposed rule expressly encompasses H-1B petitions subject to the annual cap, including beneficiaries selected under the additional 20,000 H-1B numbers available to qualifying graduates of U.S. institutions. Employers should therefore not assume that sponsoring a U.S.-educated graduate provides an exemption from the proposed charge. 

• Cap-Exempt Employers Are Different: The proposal is directed at H-1B petitions subject to the statutory annual cap, so employers filing genuinely cap-exempt H-1B petitions would not be subject to this particular $103,265 charge. This distinction is especially important for universities and qualifying nonprofit research organizations, many of which file H-1B petitions outside the annual cap. 

• The Employer, Not the OPT Student, Is the H-1B Petitioner: The proposed fee would be associated with the employer’s H-1B petition rather than with the student’s existing F-1 or OPT authorization. Employers should nevertheless review their H-1B sponsorship policies, budgeting assumptions and employee agreements because a six-figure government charge could materially change the economics of sponsoring entry-level foreign graduates. 

• The Timing of the H-1B Cap Process Will Matter: Employers should continue preparing H-1B registrations and petitions under the rules currently in effect rather than treating the proposed fee as an immediate filing obligation. At the same time, companies that depend heavily on OPT and STEM OPT workers should monitor the rulemaking closely because the final rule could materially affect sponsorship decisions and workforce planning. 

OPT and the Separate Fixed-Admission-Period Rule 

A separate DHS rule concerning the admission and extension of F-1, J-1 and I-1 nonimmigrants should also be distinguished from the proposed $103,265 H-1B fee. That rule replaces the traditional duration-of-status (D/S) framework with fixed periods of admission and establishes new extension-of-stay procedures, creating potentially significant additional administrative requirements for F-1 students. 

Under the transition framework described in the rule, certain post-completion OPT and STEM OPT applicants who file their Form I-765 applications by March 18, 2027 generally remain subject to the existing application structure rather than immediately having to file a separate Form I-539 for an extension of F-1 status. After the transition period, however, students in circumstances requiring an extension of F-1 status may have to submit both Form I-765 and Form I-539, creating an additional filing fee and another USCIS adjudication. The rule also permits DHS to extend the transition exemption in six-month increments. 

This is not a $100,000 or $103,265 OPT fee. It is a separate consequence of DHS’s move from duration of status to fixed admission periods and should be analyzed independently from the proposed H-1B fee. 

Looking Ahead 

• The 30-Day Comment Period Is the Immediate Next Step: The proposed $103,265 fee is scheduled for Federal Register publication on August 25, 2026, after which interested parties will have 30 days to submit comments. Employers, universities, trade associations and immigration organizations will have an opportunity to challenge or question the scope, methodology, legal authority and economic consequences of the proposal. 

• Litigation Is Highly Likely: The proposal arrives immediately after the federal courts rejected the Administration’s earlier attempt to impose the $100,000 payment through presidential proclamation. The First Circuit’s July 24 decision left the district court’s vacatur in effect and specifically addressed the government’s failure, at that stage of the litigation, to establish a likelihood of success in defending the earlier implementation. 

• The Legal Theory Will Be Closely Scrutinized: Because the proposed fee is more than $100,000 and would generate billions of dollars annually, one of the central questions will be whether DHS possesses sufficient statutory authority to impose such a charge through regulation. The Administration characterizes the proposal as a mechanism for recovering a portion of the federal government’s costs of administering the lawful immigration system, while opponents are likely to argue that a charge of this magnitude functions as an unauthorized tax or exceeds executive-branch authority. 

• Employers Should Not Assume the Fee Will Take Effect: The proposed rule does not itself create an immediate $103,265 payment obligation. Until DHS completes rulemaking and establishes an effective date, employers should continue to follow the H-1B fee requirements currently applicable to their petitions while monitoring the proposal and the related litigation. 

• OPT-to-H-1B Sponsorship Could Become More Difficult: If finalized substantially as proposed, the fee could fundamentally change the economics of sponsoring foreign graduates who transition from F-1 OPT or STEM OPT to H-1B status. The impact could be particularly significant for employers that rely on early-career foreign professionals in technology, engineering, consulting, healthcare and other specialized occupations where the employee’s initial compensation may be far below the proposed government charge. 

Conclusion 

The Administration’s latest H-1B initiative should therefore not be described as a renewal of the $100,000 H-1B proclamation. The original payment requirement has been vacated and is not currently enforceable, while DHS is pursuing a separate regulatory strategy that would establish a $103,265 fee for cap-subject H-1B petitions, potentially including petitions for foreign graduates already working in the United States on OPT or STEM OPT. If finalized, the proposal could represent one of the most significant increases ever imposed on the cost of H-1B sponsorship and could substantially alter how U.S. employers evaluate sponsorship of international graduates. At present, however, the fee remains only a proposal, and its ultimate form will depend on the public-comment process, DHS’s final rule and the inevitable legal challenges that are likely to follow.

The content of this article is intended only to provide a general guide to the subject matter. It should not be construed as legal advice. Please contact FGI at info@fakhouryglobal.com or (+1) 248.643.4900 for guidance if you have specific questions.