H-1B Fiscal Year 2026 Is Here: New Registration Fee, Increased Scrutiny Expected

Last week, U.S. Citizenship and Immigration Services (USCIS) announced that the initial registration period for the Fiscal Year 2026 H-1B lottery will open at noon EST on March 7, 2025, and run through noon EST on March 24, 2025. Beneficiaries selected in the Fiscal Year 2026 lottery become eligible to commence work in H-1B status no earlier than Oct. 1, 2025.

Of note for this year, the registration fee paid by an employer for each beneficiary registered in the lottery will increase from $10 to $215. Employers should also be mindful of recent revisions to H-1B regulations which may affect whether an employee beneficiary is ultimately eligible for H-1B status.

About the H-1B Lottery

The H-1B Specialty Occupation program allows companies in the United States to temporarily employ foreign workers in occupations that require the theoretical and practical application of a body of highly specialized knowledge and a bachelor’s degree or higher in the specific specialty, or its equivalent.

There is an annual limitation of 65,000 visas, which are renewable for up to six years (or longer in certain circumstances). Foreign workers who hold a U.S. master’s or doctoral degree are eligible for an additional 20,000 visas set aside exclusively for the advanced degree exemption. However, H-1B registrations/petitions are subject to a random electronic lottery, due to demand outpacing numerical limitations, and compete for the employment start date of Oct. 1.

Last year, USCIS received 442,000 beneficiary registrations during the registration period. USCIS selected 114,017 beneficiaries in its initial March 2024 lottery draw and then selected an additional 13,607 in a second draw of the lottery in July 2024 in order to ultimately approve the approximately 85,000 total H-1Bs that can be granted during any given fiscal year.

Certain employers and organizations may not be subject to the annual H-1B cap. These employers include institutions of higher education and their related or affiliated nonprofit entities and nonprofit research organizations or governmental organizations.

Selection in the H-1B Lottery

After the close of the registration period, USCIS will conduct its initial selection process and Notices of Selection will be sent to selected registrants.

Petitioners and their representatives must file for the selected beneficiaries within 90 days of receiving notification of selection. Last year, completed H-1B petitions for selected registrants were due by June 30, 2024. Additionally, there may be a second round of selections in late summer/early fall, allowing additional registrations to be selected for the remaining numerical allocations. There has historically been a second — or even third — draw of the lottery, but a second or subsequent draw is not guaranteed.

Changes for Fiscal Year 2026

The registration fee for the Fiscal Year 2026 lottery will increase to $215 per beneficiary, up from $10 in prior years. In addition to this fee change, the Department of Homeland Security (DHS), the federal executive department under which USCIS falls, issued regulations in Dec. 2024 that have introduced several changes to the H-1B process. These new rules provide clarification on qualifying degrees, “cap-gap” protections, third-party placements and beneficiary-owner rights, as well as other topics. These regulations took effect on Jan. 17, 2025.

Five Key Takeaways From the New H-1B Regulations:

Degree Requirement Clarification

In order to qualify for H-1B status, an employer must establish that the beneficiary will work in a “specialty occupation.” Specialty occupation means an occupation which requires theoretical and practical application of a body of highly specialized knowledge in fields of human endeavor, and which requires the attainment of a bachelor’s degree or higher in a directly related specific specialty, or its equivalent, as a minimum for entry into the occupation in the U.S. A position is not a specialty occupation if attainment of a general degree, without further specialization, is sufficient to qualify for the position. Of note, there may be positions requiring general engineering or business degrees without clarifying a specific major, concentration or other specialized field of study. A position may, however, allow for a range of qualifying degree fields, provided that each of those fields is directly and logically related to the duties of the position.

Additionally, the new regulations introduce a change to the final merits analysis of H-1B specialty occupations. In the past, petitioners needed only demonstrate that the position offered met at least one of four regulatory criteria to qualify as a specialty occupation. The new regulations clarify that meeting at least one of the regulatory criteria remains necessary, but that the position must also meet the definition of specialty occupation as a whole.

F-1 OPT Students’ Employment Protection

Historically, F-1 students in Optional Practical Training (OPT) have been eligible for an interim period of employment authorization, referred to as “Cap-Gap Extension” if a cap-subject H-1B petition requesting a change of status was filed on the student’s behalf and selected for processing.

The new rule extends “cap-gap” protections for F-1 students selected in the lottery. Previously, these protections extended work authorization only until Oct. 1 of the requested H-1B year. Now, the protection is extended through April 1 of the following fiscal year (e.g., until April 1, 2026, for students selected in the March 2025 lottery), preventing a disruption in work authorization while the H-1B petition is being processed.

Changes to Worksite and Job Duties

The new regulation reinforces USCIS’s longstanding requirement that an employer must file a new nonimmigrant petition if there are any material changes to the H-1B employment, including changes in worksites and/or changes in position responsibilities. Such new petitions must be filed before the change in worksite or responsibilities occurs.

Increased Employer Compliance Review

There are several aspects of the new H-1B regulations that demonstrate a greater focus on employer compliance. First, the final rule codifies and bolsters the existing Fraud Detection and National Security (FDNS) unit’s site visit program, through which FDNS carries out compliance reviews to ensure that petitioners (employers) and beneficiaries (employees) adhere to the terms of the Labor Condition Application and H-1B Petition filings.

DHS has implemented a requirement for employers to provide a “bona fide” work offer for the beneficiary in a specialty occupation. The new rule clarifies that the petitioner must demonstrate that a legitimate specialty occupation position is available for the beneficiary starting from the requested validity date, that the beneficiary will perform the work, and the work will be carried out within the U.S. Importantly, the regulation explicitly permits telework, remote work or other off-site work within the U.S.

DHS now has the explicit authority to conduct site visits to inspect, verify and review compliance to ensure that employers and employees are entitled to the benefits they seek and comply with regulations. The rule also sets penalties for employers who fail to cooperate with these inspections.

Scrutiny of Third-Party Placements

The H-1B Modernization Rule also clarifies that petitions for H-1B workers assigned to third-party organizations must demonstrate that the work at the third-party location qualifies as a specialty occupation. USCIS will assess the qualifications of the third-party organization where the employee will work, rather than those of the employer petitioning for the employee.

What To Do Now

With the exception of the fee increase, all changes to H-1B processing will affect the submission and adjudication of complete filings (i.e., filings after selection in the lottery for cap-subject beneficiaries). Nonetheless, employers may want to consider the changes under the new regulations to determine which members of their workforce qualify for H-1B status.

For more information regarding the Fiscal Year 2026 H-1B Cap, please reach out to one of our Immigration and Nationality Practice Group Co-Chairs, Manuela M. Morais or Jeffrey M. Zimskind.