The short version
A federal court in Massachusetts vacated the fee on June 8, 2026. The government asked an appeals court to let it keep collecting the fee anyway while it appealed. On July 24, 2026, that appeals court said no. The fee is off, USCIS can't collect it, and DHS while making clear it's unhappy about this says it will follow the court's order for now. DHS has also made a point of warning employers that if the order ever goes away, it intends to start collecting the fee again immediately.
In other words: this is good news today, not necessarily good news for good.
How we got here
The fee started with Presidential Proclamation 10973, signed September 19, 2025. It required a $100,000 payment for new H-1B petitions filed on or after September 21, 2025, for workers who were outside the United States and would enter through consular processing. Before this, the total government fees on an H-1B petition typically ran $2,000 to $8,000 so this was an increase of more than 2,000 percent, aimed at a specific slice of H-1B cases rather than the program as a whole.
The administration's stated goal was to curb "wage dumping" and fraud, framing certain uses of the H-1B program particularly by outsourcing firms as a threat that justified the fee.
Twenty state attorneys general, led by California, disagreed and sued in federal court in Massachusetts. Their case, State of California v. Mullin, 1:25-cv-13829 (D. Mass.), argued that the agencies implementing the fee had exceeded their statutory authority and violated the Administrative Procedure Act, and that the fee would hurt public universities, schools and healthcare systems that depend on hiring skilled foreign workers.
The June ruling: a tax, not a fee
On June 8, 2026, U.S. District Judge Leo Sorokin sided with the states. His reasoning was straightforward regardless of what the administration called the $100,000 payment, its actual substance and application made it a tax and only Congress can impose taxes. Since the executive branch doesn't have that authority on its own, Judge Sorokin vacated the policy entirely, nationwide.
That should have been the end of it? It wasn't
The appeal, the pause, and the fight over a stay
The government appealed and asked for a stay essentially, permission to keep collecting the $100,000 fee while the appeal played out. The district court wouldn't grant a full stay, but it did allow a brief administrative pause starting June 12 so the First Circuit Court of Appeals could weigh in. That gave USCIS a window to keep enforcing the fee while the emergency motion was pending.
The government filed that emergency motion with the First Circuit on June 18, 2026, arguing that blocking fee collection immediately would cause irreparable harm to agency operations.
The First Circuit says no July 24, 2026
On July 24, 2026, a three judge panel of the First Circuit Chief Judge David J. Barron, Judge Gustavo A. Gelpí, and Judge Julie Rikelman, denied the government's request.
Two things stood out in their reasoning:
The government hadn't made a strong enough showing that it was likely to win its appeal on the merits.
The states were likely to be substantially harmed if the fee were allowed to resume in the meantime.
The panel also dug into the underlying legal question. It pointed out that Congress has historically been explicit when it wants to authorize an immigration related fee the Immigration and Nationality Act contains provisions where Congress specifically green lit fee collection and spelled out how the money should be used.
The statutes the administration leaned on here didn't have anything like that language and the judges questioned whether a general presidential power to impose "restrictions" on entry could really stretch far enough to justify a $100,000 payment requirement without clearer authorization from Congress.
Because the stay was denied, the temporary administrative pause expired, and Judge Sorokin's nationwide vacatur snapped back into full force. On July 28, 2026, USCIS updated its guidance to confirm it can't currently enforce the fee.
DHS's own statement on this is worth reading closely, the agency says it "strongly disagrees" with the First Circuit's order but will comply with it while it "considers next steps." It also added, pointedly, that if this order is ever lifted, DHS still plans to collect the payment. That's not the language of an agency that considers this settled.
What this actually means if you're filing an H-1B petition today
What we'd tell employers and workers right now
File now if you were waiting. With the fee blocked, the cost risk of filing today is lower than it's been in months. Waiting doesn't protect you from a future reinstatement filing before one might.
Don't treat this as permanent. DHS has told you, in writing, that it wants this fee back. Build that into your planning rather than assuming the current status quo is stable.
If you already paid the $100,000 fee, keep watching for refund guidance. The courts haven't specifically addressed what happens to fees already collected before the June 8 ruling.
Confirm your filing dates. If you have upcoming international travel and hold an H-1B, make sure your petition's filing date is documented it's the clearest way to show you fall outside any future version of this fee if it comes back in some form.
Who this affects most
Indian nationals make up roughly three quarters of all H-1B recipients, so this litigation has always mattered disproportionately to Indian professionals and the companies often smaller and mid-sized IT services firms that sponsor them. A reinstated $100,000 fee would make sponsorship financially out of reach for many of those employers. For now, that pressure is off. It's just not guaranteed to stay off.
Quick FAQ
Q: Do I have to pay $100,000 for my H-1B right now?
A: No. The fee is vacated and blocked following the First Circuit's July 24, 2026 ruling.
Q: Is this over?
A: No. This was a ruling on whether the fee could stay in effect during the appeal not a final decision on whether it's legal. The appeal continues, a separate DC Circuit case is pending, and DHS has said it wants the fee reinstated.
Q: Can my employer pass this fee on to me?
A: No. Department of Labor rules require the employer, not the employee, to cover H-1B petition costs.
Q: Should I file now or wait for more certainty?
A: Filing now, while the fee is blocked, generally carries less cost risk than waiting. Talk to an immigration attorney about your specific situation before deciding.
A few other recent changes are worth knowing about if you're navigating H-1B or related visas this year: USCIS has already confirmed the FY 2027 H-1B cap has been reached with no second lottery expected, new USCIS signature requirements took effect July 10, 2026 and can result in permanent denials for something as small as a signature error, and H-4 dependents may separately be facing EAD processing delays that have nothing to do with this fee fight but can still hold up a family's plans. If you're also thinking about F-1-to-H-1B transitions for students, we've covered the relevant F-1 rule changes separately.
This article is for informational purposes only and isn't legal advice. Immigration law is moving fast on this topic talk to a qualified US immigration attorney before making decisions based on your specific case or reach us for attorney consultation.
