The H-1B visa: Facts, requirements, processes

The H-1B visa allows U.S. employers to hire foreign professionals to work in the U.S. when qualified Americans cannot be found. Here are the requirements, processes and latest changes to this program.

1 2 Page 2
Page 2 of 2

H-1B visa duration

According to USCIS, foreign workers with H-1B visas can stay in the U.S. for up to six years, as an H-1B visa is initially valid for three years and can be extended for another three years. When a worker's H-1B expires, the worker must either leave the U.S., obtain an extension of the visa through the American Competitiveness in the Twenty-First Century Act (AC21), or apply for a different visa status. If the worker simply stays in the U.S. past the expiration of the H-1B status, the worker loses legal status in the U.S. and can be removed (deported).

Under AC1, two groups of H-1B visa holders can extend their visa past the six-year maximum, according to NOLO.com, an online legal information service that connects people with available immigration attorneys in their geographic area: workers who are the beneficiary of an approved immigrant worker petition (I-140) and cannot yet file a green card application because the worker’s "priority date" is not current, and workers whose U.S. employers filed a Labor Certification application or an I-140 petition on the worker’s behalf prior to the beginning of the sixth year in H-1B status.

Due to backlogs in priority dates for some categories, workers could potentially be in H-1B status for many years beyond the six-year maximum waiting for their priority date to become current.

H-1B denial rates

Rates of H-1B visa denials have risen sharply over the past few years, according to Forbes, and there’s been a substantial increase in Requests for Evidence (RFE), which requires the sponsoring employers to submit further information about their sponsored employee(s) or to fill in gaps or omissions in the visa application.

Denial rates for H-1B petitions rose from 6 percent in 2015 to 24 percent through the Q3 of 2019 for new H-1B petitions for initial employment, according to a National Foundation for American Policy (NFAP) analysis. The denial rate for H-1B petitions for continuing employment (for existing employees) remained relatively stable (and high) at 10 percent in Q2 of 2019 and 9 percent in Q3, according to the NFAP analysis.

As of Q2 2019, the RFE percentage of completed H-1B visa petitions was 48 percent compared to an RFE percentage in 2015 of 22 percent, according to USCIS data compiled by Envoy Global.

How much are H-1B visa holders paid?

The current minimum salary for H-1B visa holders is $60,000 per year, unchanged since the program began in 1989. The program does mandate that employers pay H-1B holders the “prevailing wage” for their work. That means in technology some H-1B workers can earn upwards of $100,000 annually; however, a recent report showed that between 2010 and 2016, the average salary for H-1B visa holders working in technology was $80,600.

In January 2017 California Representative Zoe Lofgren introduced the High-Skilled Integrity and Fairness Act of 2017. This bill prioritizes allocation of H-1B visas to companies that agree to pay H-1B visa holders 200 percent of the current minimum salary, $130,000. In addition, the bill reserves 20 percent of H-1B visas for businesses with less than 51 full-time employees, including parent companies, subsidiary or other affiliated entities. The bill was referred to the Subcommittee on Immigration and Border Security, but nothing further has happened with it.

In January 2017 Congressman Darrell Issa (R-Calif.) supported by Congressman Scott Peters (D-Calif.) introduced H.R. 170, the Protect and Grow American Jobs Act. This bill would increase the attestation requirements of H-1B employees to $100,000. It too is awaiting action by the Subcommittee on Immigration and Border Security, and has languished in Congress.

Path to permanent U.S. residence

The holder of an H-1B visa can have “dual intent.” Although the H-1B is a non-immigrant visa, the holder can apply for a green card at the same time. Because the time required to obtain a green card has lengthened in recent years, the H-1B offers a way for individuals to work in the U.S. while seeking to become permanent residents.

H-1B visa revocation

The USCIS can revoke an H-1B visa. While it is not common, it does happen if the sponsoring employer is going out of business or cancels their original request. After the H-1B visa has been granted, employers can terminate employees but must comply with the terms of any employment agreement and follow federal, state, and local employment law.

Visas similar to H-1B

A number of visas similar to H-1B exist. The H-1B1 visa and the E-3 visa, for example, allow individuals from Chile and Singapore and Australia, respectively, to work in the U.S. under essentially the same requirements as the H-1B visa. Each year, 1,400 workers from Chile and 5,400 workers from Singapore may obtain H-1B1 visas. The E-3 visa allows 10,500 Australians to work in the U.S.

The Temporary Business visa allows holders to remain in the U.S. for six months to cut a business deal, attend a conference or complete training. The F-1 visa is for international students studying at U.S. colleges and universities, and the Optional Practical Training (OPT) program allows F-1 visa holder students to remain in the U.S. for 12 months after graduating. Those with STEM degrees from Student and Exchange Visitor Program (SEVP)-certified and accredited U.S. colleges and universities are eligible for an additional 24-month OPT extension. To read more about STEM-OPT, see "Hiring STEM-OPT Employees: What businesses need to know."

H-1B visa dependents

Spouses and children under 21 can get an H-4 visa to enter the U.S. with an H-1B visa holder. The H-4 visa holder can stay in the U.S. as long as the H-1B is in effect. An individual with an H-4 visa can attend school, get a driver’s license, and open a bank account. As of May 26, 2015, certain H-4 visa holders can become “lawful permanent residents” (LPR) and become eligible to work.

However, the Trump administration has threatened to revoke H-4 visa opportunities. A federal legislative proposal to strip work authorization from spouses of H-1B visa holders is moving forward currently, but there’s currently no final decision from USCIS.

H-1B visa holder taxation

H-1B visa holders have to obtain an Individual Taxpayer Identification Number and pay U.S. taxes, Social Security, and Medicare. However, the rules can get very complicated depending on whether the H-1B visa holder is categorized as a resident alien or a non-resident alien. At a summary level, the IRS uses the “substantial presence test” to classify each H-1B holder.

Substantial presence is a function of the number of days an individual has spent in the U.S. during the current tax year along with the prior three tax years. Individuals who fall above the threshold are deemed resident aliens and are taxed on all income, including non-U.S income. Individuals who fall below the threshold are considered non-resident aliens and are only taxed on U.S income. There are a large number of rules and exemptions, so it’s recommended that H-1B visa holders consult a tax specialist.

Copyright © 2020 IDG Communications, Inc.

1 2 Page 2
Page 2 of 2
7 secrets of successful remote IT teams