Should You Pay the New $100,000 H-1B Fee?

By Tom Yuen, CPA, MST
Gray, Gray & Gray, LLP

Executive Summary

The Trump Administration’s new $100,000 H-1B visa application fee, which went into effect on September 21, 2025, has fundamentally altered the economics of hiring high-skilled foreign workers. This one-time fee applies only to new H-1B petitions for workers from outside the U.S. and does not affect renewals or current visa holders. For companies in the life sciences, biotech, and high-tech sectors that have traditionally relied on H-1B talent, this represents a seismic shift requiring immediate strategic reassessment.

Bottom Line: While the fee is substantial, companies with critical talent needs and strong financial positions may find it worthwhile for top-tier candidates. However, most organizations should explore alternatives and adjust their hiring strategies accordingly.

The Business Case FOR Paying the $100,000 Fee

The huge increase in the H-1B fee is shocking at first glance. But a closer analysis reveals that ponying up $100,000 may be a smart investment. Here’s why:

1. Access to Exceptional Talent: For roles requiring truly unique expertise, such as AI researchers, specialized biotechnologists, or senior software architects, the $100,000 investment may yield significant returns. Consider that top-tier tech talent can generate millions in value through innovation, patent development, or revenue-generating products.
2. Competitive Advantage Through Quality: The high fee acts as a quality filter, ensuring companies only pursue candidates they genuinely believe are exceptional. This could lead to better hiring decisions and reduced competition for the most qualified individuals.
3. Long-term ROI Potential: Unlike annual fees, this is a one-time cost. For a senior engineer with a $200,000+ salary over 6 years of H-1B eligibility, the fee represents roughly 8% of total compensation, potentially justified for critical roles.
4. Market Positioning: Companies willing to pay the fee signal their commitment to attracting top global talent, potentially enhancing their employer brand and ability to recruit other high-caliber candidates.

The Business Case AGAINST Paying the $100,000 Fee

Then again… not all companies have the wherewithal to come up with such a significant amount to invest in an individual who may or may not work out. Here are some other reasons to eschew the new fee:

1. Dramatic Cost Increase: Previous H-1B costs typically totaled $5,000-$10,000 (including filing fees, legal costs, and compliance). The new fee represents a 1,000-2,000% increase, fundamentally changing the cost-benefit equation.
2. Budget Impact on Volume Hiring: Companies previously hiring 50+ H-1B workers annually would face an additional $5 million in costs. This scale makes the program prohibitively expensive for most organizations.
3. Alternative Talent Availability: The tight U.S. job market and increased STEM graduate production mean domestic talent pools may be sufficient for many roles, eliminating the need for costly international hiring.
4. Uncertainty and Risk: Visa processing delays, potential policy changes, and the risk of denial mean companies could lose their $100,000 investment without securing the intended worker.
5. Shareholder and Stakeholder Pressure: Publicly traded companies may face criticism for spending significant sums on immigration fees rather than R&D, expansion, or shareholder returns.

Viable Alternatives to H-1B

Not all high-skill workers come to the U.S. under the H-1B program. Here are some possible workarounds for acquiring talent without paying the huge new fee.

O-1 Visas for Extraordinary Ability represent perhaps the most compelling alternative for senior-level positions. With total costs of approximately $3,000 to $5,000, O-1 visas offer significant advantages, including no annual cap limitations, a three-year initial period, and unlimited extensions. However, they require meeting a higher qualification threshold demonstrating “extraordinary ability” in sciences, arts, education, business, or athletics. These visas are best suited for senior researchers, proven innovators, and recognized industry leaders who can demonstrate sustained national or international acclaim.

L-1 Intracompany Transfer visas provide another viable option for companies with existing international operations. Costing between $2,000 and $8,000, depending on company size, L-1 visas eliminate prevailing wage requirements and can facilitate the establishment of a new office in the U.S. The primary limitation is the requirement for existing international operations and one year of prior employment with a foreign affiliate. Companies with global footprints can leverage blanket L-1 petitions to streamline the process for qualifying organizations with established track records of international transfers.

Enhanced F-1 to H-1B Pipeline Development offers a strategic workaround since change of status applications from students already in the U.S. avoid the $100,000 fee entirely. Companies can strengthen university partnerships, expand internship programs, and develop more robust recruitment relationships with graduate programs in STEM fields. This approach requires longer-term planning but provides access to high-quality international talent at traditional cost levels.

Remote Work and Offshore Development strategies have gained significant traction, with approximately 40% of companies expanding international remote work capabilities. While significantly lower in cost than U.S.-based employment, this approach requires careful consideration of time zone differences, communication challenges, and intellectual property protection measures. The shift toward distributed teams can provide access to global talent pools without the complexities of immigration.

Direct Green Card Sponsorship through EB-1 or EB-2 National Interest Waiver categories offers a long-term strategy for exceptional candidates. With total costs ranging from $10,000 to $20,000 and timelines of one to three years, depending on the category and country of origin, this approach can provide permanent residence directly for the most valuable international talent, bypassing the H-1B system entirely.

Accounting and Financial Treatment

With such a huge increase in the H-1B fee, it is important that you account for the expense properly.

Expense Classification: The $100,000 H-1B fee should be classified as an operating expense under personnel or professional services costs. This is consistent with other visa-related expenses and DOL guidance, which indicate that such costs are employer business expenses.

Tax Deductibility: The fee is likely tax-deductible as an ordinary business expense under IRC Section 162, similar to other recruitment and visa processing costs. However, companies should confirm with their tax advisors given the fee’s unprecedented size.

Financial Reporting

• Income Statement: Record as operating expense in the period incurred
• Cash Flow: Classify as operating cash outflow
• Budgeting: Treat as a one-time cost per new international hire

Examples of How It Might Work

Case Study 1: BioTech Startup

• Situation: 200-employee biotech company seeking a world-renowned genomics researcher from Germany
• Analysis: Candidate has potential to lead $50M drug development program
• Decision: Pay the fee
• Rationale: ROI potential exceeds 500:1 if research succeeds; candidate’s expertise unavailable domestically
• Accounting: Expense recorded immediately; ROI tracked against future patent filings and licensing deals

Case Study 2: Software Company

• Situation: 1,000-employee SaaS company typically hiring 25 H-1B developers annually
• Analysis: $2.5M additional annual cost vs. expanded domestic recruiting
• Decision: Reduce H-1B hiring by 80%, focus on F-1 students and domestic talent
• Accounting: Redirect $2M to domestic recruiting, university partnerships, and retention programs

Strategic Recommendations

Large Tech Companies with over 1,000 employees should adopt a highly selective strategy, using H-1B visas only for truly exceptional candidates representing the top 10% of their previous applicant pools. These organizations have the financial capacity to absorb the $100,000 fee for genuinely transformational talent while simultaneously expanding their use of O-1 visas for senior technical leaders, L-1 visas for international transfers, and enhanced international student recruitment programs. Geographic diversification through the establishment of additional international development centers can provide long-term access to global talent pools, thereby mitigating immigration constraints.

Mid-Size Companies ranging from 100 to 1,000 employees should implement a pause-and-assess approach, temporarily halting new H-1B applications while conducting thorough evaluations of alternative visa strategies and domestic talent availability. These organizations benefit from developing stronger partnerships with universities that have substantial international student populations, particularly those with relevant STEM graduate programs. Implementing comprehensive remote-first policies can unlock access to international talent while avoiding the complexities and associated costs of immigration.

Startups and Small Companies with fewer than 100 employees will generally find the $100,000 fee prohibitively expensive relative to their typical operating budgets. They should focus exclusively on hiring international students already present in the U.S. through F-1 visa programs. For founder-level technical talent, exploring O-1 visas for individuals with extraordinary ability provides a more cost-effective path to accessing exceptional international expertise. These smaller organizations can leverage their agility to build remote-first cultures from inception, accessing global talent without the constraints of traditional immigration pathways.

Financial Planning Considerations require companies to model multiple scenarios for international hiring volumes, typically examining three to five different approaches to understand cash flow implications and budget impacts. Organizations must consider the timing effects of large upfront payments on quarterly financial results and develop clear return-on-investment metrics for any $100,000 visa investments. Risk management strategies should include contingency plans for potential additional policy changes, ensuring operational flexibility regardless of future immigration developments.

What’s Your Next Step?

The $100,000 H-1B fee represents the most significant change to U.S. high-skilled immigration in decades. While it doesn’t eliminate the option to hire international talent, it fundamentally changes the economics. Companies must now approach international hiring with the same rigor typically reserved for major capital investments.

The winners will be organizations that quickly adapt their talent acquisition strategies, explore alternative visa categories, and invest in developing domestic talent. Those that continue with business-as-usual approaches risk competitive disadvantage and unsustainable cost structures.

Action Items for Leadership:

1. Conduct immediate review of current H-1B pipeline and costs
2. Evaluate alternative visa strategies with immigration counsel
3. Assess domestic talent market and university partnerships
4. Develop clear ROI criteria for any future $100,000 visa investments
5. Consider international expansion to access global talent pools

The new landscape requires strategic thinking, financial discipline, and operational flexibility. Companies that master these elements will continue to attract world-class talent while maintaining competitive cost structures.

This analysis is based on current regulations and market conditions as of September 2025. Companies should consult with qualified immigration attorneys and tax advisors before making strategic decisions. Immigration law and policy can change rapidly, and individual circumstances may warrant different approaches.