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Most people who need a new H-1B have to go through a lottery. A much smaller group does not. This page explains which employers and which jobs sit outside the annual H-1B numerical limit, which workers have already been counted and so are not counted again, and which visa categories let nationals of a few countries avoid the lottery altogether.
Congress limits the number of new H-1B workers each fiscal year. The regular quota is 65,000. A further 20,000 numbers are reserved for beneficiaries who hold a U.S. master’s degree or higher — the statutory “advanced degree exemption,” commonly called the master’s cap. USCIS has confirmed that both the 65,000 regular cap and the 20,000 master’s cap were reached for fiscal year 2027.
Because demand exceeds supply, an employer can no longer simply file a petition and hope. The process now runs in two stages:
Selection is no longer a flat random draw. Under the regulations, USCIS assigns each unique beneficiary to the lowest OEWS wage level among all registrations submitted for that beneficiary, then enters the beneficiary into the pool once for wage level I, twice for level II, three times for level III and four times for level IV. The regular cap is filled first; the master’s cap allocation is run afterwards from the registrations that remain.
Two things follow from this. Entry-level and lower-paid positions now face materially worse odds than they did under a flat lottery. And a job that genuinely sits outside the quota is worth far more than it used to be.
Sections 214(g)(5)(A) and (B) of the Immigration and Nationality Act place certain employment outside the numerical limit. In broad terms, four situations qualify:
An exempt petition can be filed at any time of year. There is no registration, no lottery, and no need to wait for the next fiscal year to begin.
The single most important point to grasp is that exemption attaches to the employment, not to the person. Nothing about the worker’s degree, nationality or history makes them cap-exempt. It is the petitioning employer, or the place and nature of the work, that carries the exemption. When the employment changes, the exemption can disappear.
The chart below compares the exemptions side by side.
| Type of Employer | Profit or Non-profit | Key Requirements | Conditions of Employment |
|---|---|---|---|
Institution of higher education — a college or university | Must be public or non-profit. A for-profit college does not qualify, however well known. | All five elements of 20 U.S.C. 1001(a): admits only high school graduates or the equivalent; legally authorized in its state; awards a bachelor’s degree or offers at least a two-year program creditable toward one; public or other non-profit; accredited or preaccredited. | Worker must be employed at the institution. No IRS determination letter needed. No registration and no lottery — file at any time of year. ACWIA training fee not required. |
Non-profit related to or affiliated with a university | Non-profit only, and it must hold an IRS determination under section 501(c)(3), (c)(4) or (c)(6). | Any one of the four conditions at 8 CFR 214.2(h)(8)(iii)(F)(2): shared ownership or control by the same board or federation; operated by the university; attached as a member, branch, cooperative or subsidiary; or a formal written affiliation agreement establishing an active working relationship for research or education, where a fundamental activity of the non-profit directly contributes to the university’s research or education mission. | Employed at the entity. The non-profit may have more than one fundamental activity. Cap-exempt and ACWIA-exempt. No registration or lottery. |
Non-profit research organization | Non-profit only, plus the same IRS 501(c)(3)/(4)/(6) determination. | A fundamental activity is engaging in basic and/or applied research. Since January 17, 2025 this replaced the old “primarily engaged” test, so research need not be the organization’s main purpose. | Employed at the organization. Research may be in the sciences, social sciences or humanities, and includes designing, analyzing and directing the research of others on an ongoing basis throughout the research cycle. No registration or lottery. |
Governmental research organization | Neither — a government body. Federal, State or local all qualify. The IRS requirement does not apply. | A fundamental activity is the performance or promotion of basic and/or applied research. Since January 17, 2025 this replaced the old “primary mission” test. | Employed at the organization. A public body that funds or coordinates research, rather than running the laboratory itself, is within the wording. No registration or lottery. |
Any type — including for-profit staffing, consulting and contracting firms, where the work is performed at one of the qualifying entities above | The petitioning employer may be for-profit. The host entity must be one of the four categories above. | 8 CFR 214.2(h)(8)(iii)(F)(4): the worker spends at least half of their work time on duties at a qualifying entity, and those duties directly further an activity that supports or advances one of that entity’s fundamental purposes, missions, objectives or functions. | “At” includes telework, remote and other off-site work performed in the U.S.; USCIS looks at the duties, not where they are physically performed. The exemption lasts only while the arrangement continues. LCA place-of-employment and notice obligations still apply. |
Any type — the exemption follows the worker, not the employer | Either. Irrelevant to this exemption. | INA 214(g)(7): the worker was counted against the cap within the six years before the new petition is approved, and is not eligible for a full six years when it is filed. | Covers a change of employer, an extension, an amended petition, a concurrent job, and a return after time abroad. Prior cap-exempt employment does not count, because no number was ever used. After a year outside the U.S. the petitioner may elect recapture, which stays cap-exempt, or a fresh six years, which means the lottery. |
Any type — a second, cap-subject employer added alongside an existing exempt job | Either. The second employer is commonly for-profit. | 8 CFR 214.2(h)(8)(iii)(F)(6): the worker must be in valid H-1B status under a 214(g)(5)(A) or (B) exemption, and the second petitioner must demonstrate that exempt employment. | The cap-subject petition cannot be valid beyond the cap-exempt petition. If the exempt job is terminated or otherwise ends early, the worker becomes cap-subject and USCIS may revoke the cap-subject petition, unless previously counted or another exemption applies. |
Any type — location-based rather than employer-based Guam and the Northern Mariana Islands | Either. Irrelevant to this exemption. | 48 U.S.C. 1806(b)(1)(A): an H nonimmigrant may be admitted to Guam or the Commonwealth of the Northern Mariana Islands during the transition program without counting against the section 214(g) limits, through December 31, 2029. | The services must be performed in Guam or the CNMI. Widely overlooked by employers with operations in the territories. See the section on Guam and the Northern Mariana Islands below. |
A nonprofit is not exempt simply because it is a nonprofit and does good work. Under 8 CFR 214.2(h)(8)(iii)(F)(2), a nonprofit counts as related to or affiliated with an institution of higher education only if it meets at least one of four conditions:
The fourth condition is the one most organizations rely on, and it is the one most often filed without adequate proof. A letter of goodwill is not an affiliation agreement.
Separately, the entity must be a nonprofit as defined at 8 CFR 214.2(h)(19)(iv), meaning the IRS has determined it to be tax exempt under section 501(c)(3), 501(c)(4) or 501(c)(6) of the Internal Revenue Code. Research organizations are defined at 8 CFR 214.2(h)(19)(iii)(C): an organization is a nonprofit research organization when a fundamental activity is basic or applied research, and a governmental research organization when a fundamental activity is performing or promoting such research. A governmental research organization may be federal, state or local.
This is the route that matters most in practice, because it reaches consultants, staffing arrangements, hospital groups and clinical faculty placements. Under the regulations, a beneficiary who is not directly employed by a qualifying institution still qualifies for the exemption if two things are true:
The regulation is explicit that work performed in the United States through telework, remote work or other off-site work can count, and that USCIS will focus on the job duties rather than on where they are physically performed. That is a significant change from the old approach and it removes an argument USCIS used to make against remote arrangements.
More detail is on the page for exempt employment with a third-party petitioner.
A worker in valid cap-exempt H-1B employment may add concurrent cap-subject H-1B employment without being counted against the quota. Under the regulations, the petitioner for the cap-subject job must show three things:
This arrangement is genuinely useful, but it carries risk that is easy to miss, and the risk sits in the same regulation:
In other words, the cap-subject job is only as stable as the exempt job that supports it. Losing a university appointment can quietly put a second, unrelated H-1B at risk. See concurrent employment with an exempt employer.
Physicians who complete graduate medical training in J-1 status are normally subject to the two-year foreign residence requirement. A waiver obtained through a state health department under the Conrad 30 program, authorized by section 214(l) of the Act, allows the physician to move into H-1B employment serving a medically underserved area, and Conrad 30 physicians have long been treated as outside the annual H-1B quota.
Two cautions apply, and both are current as of the date below. First, the USCIS Conrad 30 page carries an alert, last reviewed on October 1, 2025, stating that unless Congress extends the Conrad 30 provision, people who are admitted in or acquire J-1 status on or after October 1, 2025 will not be eligible for the waiver, while those who held J-1 status on or before September 30, 2025 remain eligible. Second, the Department of Homeland Security regulation on foreign medical graduate waivers at 8 CFR 212.7(c) still describes the older, narrower waiver program under Public Law 103-416, including a per-state limit of 20, and it expressly says those waiver recipients remain subject to the numerical limit. The statute has moved on; the regulation has not been rewritten to match. Anyone relying on Conrad 30 should confirm both the program’s current authorization and the cap treatment before committing to a timeline.
A worker who has already been counted against the H-1B cap is generally not counted again when a new petition is filed within the same six-year period of authorized admission. This is why an ordinary change of employer, an extension, or a return to H-1B employment after a period in another status usually does not require a registration or a lottery. The concept appears in the exemption regulation itself, which turns on whether the worker was “previously counted” within the six-year period to which the employment applies.
The practical questions are how much of the six years remains, whether time spent outside the United States can be recaptured, and whether the worker instead qualifies for a fresh six years. See previously counted under the H-1B quota.
The 20,000 numbers reserved for holders of a U.S. master’s degree or higher are called an “exemption” in the statute, and that label misleads a great many people. It is not an exemption from the quota in any useful sense. It is a second allocation that is itself numerically limited, and it requires the same electronic registration and the same selection process. A beneficiary with a qualifying U.S. advanced degree is considered first for the regular cap and then, if not selected, for the master’s allocation — two chances rather than one, but still a lottery. See the U.S. master’s degree allocation.
H-1B workers performing labor or services in Guam or the Commonwealth of the Northern Mariana Islands are exempt from the national numerical limits. This exemption comes from the Consolidated Natural Resources Act of 2008 and was extended by the Northern Mariana Islands U.S. Workforce Act of 2018 through December 31, 2029. It is genuinely a location-based exemption rather than an employer-based one, and it is frequently overlooked by employers with operations in the territories.
For nationals of three countries there is a separate specialty occupation classification that does not use the H-1B registration system at all. These are not H-1B visas and they are not H-1B quota exemptions. They are different classifications with their own eligibility rules, their own annual limits and their own procedures, and they can often be pursued at any point in the year:
All three require a certified labor condition application, and all three carry trade-offs the H-1B does not — most notably shorter initial validity and, historically, greater difficulty in pursuing permanent residence while in the classification. They are worth considering early rather than as a fallback in April.
This page is general information about United States immigration law, not legal advice, and no attorney-client relationship is created by reading it. Immigration rules change frequently and individual cases turn on their own facts. The law described here was reviewed in August 2026; please confirm current requirements or consult an attorney before acting.