Startup advocates say a $100,000 payment tied to certain H-1B workers could be much harder for a young company to absorb than for a large employer, potentially making specialized hires less affordable. That is a warning, not a demonstrated effect: the cited studies concern H-1B access generally, not the impact of this payment. As of October 8, 2026, university immigration offices report that court orders block collection while the government’s appeal remains pending.
Is the $100,000 H-1B payment currently being collected?
As of October 8, 2026, no: University of Colorado Boulder’s October 7 status update says the payment is not currently required, and the University of Michigan reported on October 1 that collection remains blocked. Colorado says a Massachusetts federal court ruled against the payment on June 8; after an initial temporary restoration, the First Circuit reinstated that ruling on July 24. The government’s appeal is pending, so the legal status could change. Colorado’s current-status update and Michigan’s update provide the cited status.
The White House’s September 18, 2026 proclamation extends the restriction for 12 months, through September 21, 2027. That announced extension does not, by itself, mean employers are now paying the amount: the court orders reported by the universities currently block collection. The proclamation describes a payment condition for entry of covered H-1B specialty-occupation workers, subject to exceptions. University summaries describe it as aimed at certain petitions involving people outside the United States who need visas to enter—not every H-1B petition.
Why do startup leaders say the payment could hurt entrepreneurship?
In an October 21, 2025 letter to the President and cabinet secretaries, innovation and entrepreneurship organizations argued that young businesses have limited early-stage resources and could be disproportionately affected by a large fixed hiring cost. They said startups may struggle to find some specialized skills locally and may rely on foreign-born workers to survive and grow. Their proposed exemption covered businesses less than 10 years old with gross assets of $75 million or less. Those are the coalition’s claims and policy request, not an established finding about what the payment has done. The signatories’ letter sets out their argument.
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The mechanism they describe is straightforward: if a covered hire costs substantially more, a cash-constrained company may delay or abandon that hire. If the missing expertise is important to developing a product, serving customers, or reaching new markets, the company’s prospects could suffer. Advocates therefore argue that a rule intended to protect U.S. jobs might also make some startups less likely to succeed and create jobs. This is a plausible concern, but the cited material does not measure whether the $100,000 payment caused fewer startups, less innovation, or fewer U.S. jobs.
The letter cites a 2020 survey, a 2024 study, and a 2015 study to support broader claims about H-1B access, startup outcomes, regional entrepreneurship, productivity, and wages. Those studies did not test the effect of this payment. The letter also attributes to Information Technology and Innovation Foundation president Robert D. Atkinson the view that a small number of foreign-born employees can be pivotal to a promising business and can help firms build overseas networks and customers.
In a September 23, 2025 TIME report, UC Davis economics professor Giovanni Peri said the idea that the H-1B program has, on net, taken jobs from U.S. workers is “empirically opposite to the truth.” Temple University Fox School of Business professor Subodha Kumar said the new fee would “hurt the innovation and competitiveness of the U.S. industry.” These are attributed expert opinions, not judicial findings or a settled consensus. TIME’s report includes both statements.
What is the administration’s case for the restriction?
The White House says the H-1B program has been exploited to replace rather than supplement U.S. workers, suppress wages, and disadvantage American workers. It presents the payment as one part of a broader response that also includes weighted selection favoring higher-paid and higher-skilled petitioners. Those are the administration’s stated rationale and policy choices, not findings established by the startup letter.
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The September 2026 proclamation reports that combined registrations from the largest IT staffing and outsourcing firms fell from 24,946 to 2,055, a 92% decrease. It also reports that the share of registrants with at least a U.S. master’s degree rose from 45.1% for FY 2026 to 66.1% for FY 2027. The administration attributes these changes jointly to the payment requirement and weighted selection. The figures therefore do not isolate the payment’s effect, establish what happened to startups, or measure innovation. The proclamation reports these figures.
How do the two arguments differ?
| Question | Administration’s position | Startup advocates’ position |
|---|---|---|
| Who is the policy meant to benefit? | U.S. workers, whom the administration says face displacement and wage suppression. | Startups and employers seeking specialized talent, as well as the workers and communities that could benefit if new firms grow. |
| What evidence is cited? | White House registration and degree-share figures that combine the payment requirement with weighted selection. | Studies about H-1B access and startup-related outcomes generally, not the measured effect of this payment. |
| How might employers be affected? | The policy is intended to address program abuse and favor higher-paid, higher-skilled petitioners. | A large fixed cost may be harder for a young, cash-limited firm to bear than for a large employer. |
| What is the current legal position? | The September 2026 proclamation extends the restriction through September 21, 2027. | University updates dated October 1 and 7, 2026 report collection blocked by court orders, with the government’s appeal pending. |
The competing arguments concern different risks: the administration emphasizes harm to U.S. workers from how it says the program has been used, while startup advocates emphasize the potential cost of limiting access to specialized hires. Neither the registration figures nor the studies cited in the letter establish the payment’s causal effect on U.S. startup formation or innovation.
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What did the original payment design say?
The White House FAQ dated September 21, 2025 described the payment as one-time. It said it applied to new petitions filed after the effective date, not previously issued visas or earlier-filed petitions, and did not change renewal fees or prevent current visa holders from traveling. That FAQ describes the original design; it should not be treated as a complete account of the policy after the 2026 extension and litigation. For the current collection status, the later university updates are more relevant. The original FAQ gives those details.
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