Public Policy Update: Federal Policy Changes

September 14, 2026 | Public Policy

DHS Proposes a $103,265 Fee on Cap-Subject H-1B Petitions

The Department of Homeland Security published a proposed rule on August 25 that would impose an additional $103,265 fee on each cap-subject H-1B petition. The fee would be paid when the petition is filed and would be charged in addition to other applicable filing fees.

The proposal would apply to petitions under the annual H-1B cap, which includes 65,000 regular-cap visas and an additional 20,000 visas available to individuals with advanced degrees from U.S. institutions.

Cap-exempt petitions would not be subject to the proposed fee. This generally includes qualifying petitions filed by institutions of higher education, affiliated nonprofit organizations, nonprofit research organizations and governmental research organizations. However, nonprofit status alone does not necessarily make a petition cap-exempt.

Why It Matters to Employers

H-1B workers often fill specialized positions in engineering, technology, health care, research and other fields where employers may struggle to find qualified applicants. An additional fee of more than $100,000 could make the program financially impractical for many employers, particularly small and mid-sized businesses.

DHS estimates that the proposal would have a significant economic impact on more than 11,000 small entities. The agency’s analysis found that the fee would represent more than 1% of annual revenue for approximately 76% of the small entities expected to be affected.

The proposal is separate from the $100,000 payment established through a 2025 presidential proclamation. A federal court vacated the guidance implementing that payment in June 2026, and the federal government’s appeal remains pending.

Opportunity to Comment

Employers that use the H-1B program or expect they may need it in the future are encouraged to review the proposal and consider submitting comments describing how the fee could affect hiring, business growth, investment, workforce planning and access to specialized skills.

Comments should identify a specific part of the proposal, explain any recommended changes and include supporting business information or data when possible.

Comments are due September 24, 2026. Read the proposed rule and submit a public comment through the Federal Register.

The Economic Alliance is reviewing the proposal as part of our continued advocacy for practical immigration policies that help employers meet workforce needs while supporting economic growth.

Beneficial Ownership Reporting Requirements End for U.S. Companies

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network has issued a final rule permanently removing beneficial ownership information reporting requirements for U.S. companies and U.S. persons under the Corporate Transparency Act.

The final rule took effect August 14, 2026. It makes permanent the exemptions initially established through an interim rule in 2025.

For most domestic businesses, this means:

U.S. companies are no longer required to submit beneficial ownership information to FinCEN.

U.S. persons who obtained FinCEN identification numbers are no longer required to update or correct their information.

FinCEN intends to delete previously reported information associated with U.S. persons who are now exempt.

Certain foreign entities registered to do business in the United States remain subject to reporting requirements, although the information they must submit has been narrowed.

This change is particularly relevant to small businesses that had been preparing for or attempting to comply with the Corporate Transparency Act’s reporting requirements. Domestic companies generally no longer need to take further action, but businesses with foreign ownership or organization structures should review the final rule or consult a qualified adviser.

Review Treasury’s beneficial ownership reporting announcement.

Paid Family and Medical Leave Tax Credit Expanded

The IRS has issued guidance on the permanent expansion of the federal employer tax credit for paid family and medical leave.

Beginning in 2026, eligible employers may claim a general business tax credit ranging from 12.5% to 25% of qualifying wages paid to employees during up to 12 weeks of family and medical leave. Employers may now also calculate the credit using premiums paid for qualifying paid family and medical leave insurance policies.

Other changes include:

Employees may qualify after six months of service.

Eligibility includes part-time employees who customarily work at least 20 hours per week.

Employers may choose between a wage-based and insurance-premium-based calculation.

Leave required under state or local law may help an employer satisfy eligibility requirements, although those mandated amounts cannot be included when calculating the federal credit.

The expansion may give small businesses another option for offering competitive leave benefits while managing part of the cost. Employers should work with their tax and benefits advisers to determine eligibility, and which calculation method is most advantageous.

Review the IRS guidance on the expanded paid family and medical leave credit.

FIRE System Retiring: Information Return Filers Must Move to IRIS

Businesses and organizations that electronically file information returns through the IRS Filing Information Returns Electronically system should begin preparing to transition to the Information Returns Intake System (IRIS).

Current FIRE users must use IRIS to file tax year 2026 information returns during the 2027 filing season. After January 1, 2027, IRIS will be the only IRS electronic filing system for forms previously supported by FIRE, including current-year returns, prior-year returns and corrections.

Important dates include:

November 1, 2026: Last day to file test information returns through the FIRE test system.

November 9, 2026: Last day to make changes to existing FIRE Transmitter Control Code applications.

November 19, 2026, at 3 p.m. Eastern: Last day to submit information returns through FIRE.

Businesses currently using FIRE must complete a separate IRIS application for a Transmitter Control Code. Existing FIRE credentials do not automatically transfer.

The IRIS Taxpayer Portal is free and allows filers to enter returns manually or upload them using a CSV file. Businesses and third-party providers filing larger volumes may use the IRIS Application-to-Application channel.

Employers, payroll providers and other information-return filers should begin the transition before year-end to avoid problems during the 2027 filing season.

Review the IRS transition guidance and steps for moving to IRIS.