You put “no visa sponsorship available” on the req because legal or finance told you to, and now your strongest candidates have gone quiet. That line is costing you more than you think, but reversing it is usually the wrong fix. The better move is to stop treating a US mailing address as a requirement for the job.
TL;DR
- A single H-1B case realistically runs $8,000-$20,000+ in fees and legal costs before anyone writes a line of code, and the September 2025 proclamation adding a $100,000 payment on certain new petitions made that number unpredictable.
- The cap lottery selects roughly a quarter to a third of eligible registrations. You can’t build headcount plans on a coin flip you get to toss once a year.
- The worst outcome isn’t losing the lottery. It’s spending five months and real money on a candidate you lose anyway.
- TN status for Mexican and Canadian professionals is genuinely cheap and fast (days, not months), but the profession list is narrow and “software developer” isn’t on it.
- The same engineer you couldn’t sponsor can usually start from Mexico, Colombia, Argentina, or Brazil in 2-6 weeks, as a contractor or through an EOR.
- You give up real things: no US-soil presence, no immigration path for the candidate, different retention dynamics. Say so out loud instead of pretending it’s free.
What an H-1B actually costs you
Most hiring managers have never seen the fees itemized. Registration is $215 per beneficiary just to enter the lottery. If selected, the I-129 petition carries a base filing fee, an ACWIA training fee of $750 or $1,500 depending on headcount, a $500 fraud prevention fee, and an Asylum Program Fee that scales with employer size. Premium processing is $2,805 for a 15-business-day response, and you will want it. Outside counsel typically bills $3,000-$8,000 per case, more with an RFE.
Then the part that isn’t a line item: the prevailing wage determination. You pay at or above the DOL wage level for that occupation in that metro, file an LCA, and post notice. The “cheaper foreign engineer” fantasy dies here: you’re paying market or above, plus legal overhead, plus risk.
In 2026 there’s a much larger asterisk. The September 2025 proclamation imposing a $100,000 payment on certain new H-1B petitions for beneficiaries abroad has been contested and litigated, and its scope has moved. Whatever it settles into, it proved the point: your immigration budget can be rewritten by executive action between the day you extend an offer and the day you file.
The lottery makes headcount planning impossible
Here’s the calendar. Registration opens in March. Selections land in late March. If selected, you file between April 1 and June 30. The earliest possible start date is October 1. If the candidate is abroad and needs consular processing, add weeks for an appointment and visa stamping.
Best case, for a role you scoped in February, is a start date seven months later. Realistic case is 9-12 months. And that’s the branch where you win. Recent cap seasons have selected roughly 25-35% of eligible registrations. If you lose, the next lottery is twelve months away. That’s not a hiring plan; it’s a raffle ticket with a roadmap stapled to it.
O-1, cap-exempt, and the other doors
O-1A (extraordinary ability) has no cap and no lottery, files year-round, and supports premium processing. It requires meeting three of eight criteria: published work, judging others’ work, original contributions of major significance, high remuneration, press. Legal fees run $8,000-$15,000 and evidence-gathering takes weeks. For a well-known researcher or maintainer, it works. For a strong-but-normal senior engineer, it usually doesn’t.
Cap-exempt employers (universities, affiliated nonprofits, nonprofit and government research organizations) file H-1Bs any time, no lottery. If you’re a startup, you’re not one.
L-1 transfer requires one continuous year abroad with a related entity in the prior three years. Note what that implies: hire someone in LATAM through your own foreign entity today and you may have an L-1 option in a year. Employment through a third-party EOR generally does not create that corporate relationship.
TN status: cheap and fast, for a narrow list of roles
TN is the one immigration category that competes with nearshore on speed and price. Created under NAFTA and continued under USMCA, it’s open to citizens of Mexico and Canada in a defined list of professions.
The mechanics are light: no cap, no lottery, no LCA, no prevailing wage determination. Canadians apply at a port of entry with a support letter and credentials for roughly $56 in government fees. Mexican citizens file a DS-160 and pay $185 at a consulate, then present at the border. Admission comes in three-year increments, renewable, with turnaround in days to a few weeks.
The catch is the list. It includes Computer Systems Analyst, Engineer, Mathematician, and Scientific Technician, each with specific degree or licensure requirements. It does not include “Software Developer” or “Software Engineer.” Cases get built under Computer Systems Analyst or Engineer, and they get questioned at the border by an officer with wide discretion and no obligation to agree with your last successful entry. The second catch: TN is not dual-intent. Starting a green card process can jeopardize renewals. Excellent for someone who fits a listed profession and doesn’t need a US immigration path, poor for anyone who does.
The pivot: same engineer, different jurisdiction
The candidate who needed sponsorship usually doesn’t need to be on US soil. They need to be in your standup, in your repo, and in your timezone.
An engineer in Mexico City, Bogotá, Buenos Aires, or São Paulo overlaps 4-8 hours with US business hours and can start in 2-6 weeks. No cap, no lottery, no filing window, no October 1 gate. You engage them as an independent contractor (fast and simple, but carrying misclassification exposure and weaker IP posture in some jurisdictions) or through an EOR, which employs them locally on compliant terms while they work on your team. Same person, same Slack, same sprint. What changes is the legal wrapper, not the work.
The four options side by side
| H-1B sponsorship | TN status | Nearshore contractor | EOR | |
|---|---|---|---|---|
| Cost to employer | $8K-$20K+ typical, plus policy surprises; prevailing wage floor | ~$56-$185 in gov fees plus counsel review | Commercial rate only; no immigration spend | Commercial rate plus a per-seat employment service |
| Time to start | 7-12 months, gated to Oct 1 | Days to ~3 weeks | 2-4 weeks | 3-6 weeks |
| Key risk | Lottery loss; RFE; mid-process policy change | Officer discretion; profession fit; no dual intent | Misclassification; IP assignment gaps | Vendor dependency; local termination rules |
| Durability | Strong once approved: 3+3 years, dual intent, green-card path | Renewable in 3-year blocks, no immigrant path | As durable as your contract | Strong: real local employment and tenure |
| Best for | Someone you truly cannot replace, on a 12-month horizon | Mexican/Canadian citizens in a listed profession | Speed, trials, short-cycle specialized work | Long-term core team members |
What you give up, honestly
No US-soil presence. No badge, no onsite customer meetings without a separate business-visitor trip. If the role is genuinely customer-facing on US ground, nearshore doesn’t solve it.
No immigration path for the candidate. This cost is borne by them, not you. Someone whose life goal is to move to the US will take a sponsored offer over yours, and should. Say it in the first call rather than letting them find out in month three.
Different retention dynamics. A sponsored H-1B employee has structural reasons to stay: switching jobs means a new petition and, in a green card queue, real risk. A nearshore engineer has none of that friction. You keep them the old-fashioned way: interesting work, a clear growth path, and paying competitively for their market. Teams that treat nearshore engineers as interchangeable capacity churn them. Teams that treat them as employees who happen to live elsewhere don’t.
This article is general information, not legal advice. Immigration rules, fees, and enforcement change frequently. Consult a licensed immigration attorney and qualified employment counsel in each jurisdiction before acting.
Frequently Asked Questions
Can we still sponsor for the one or two people we really want?
Yes, and for a truly irreplaceable hire it's often right. The discipline is reserving sponsorship for cases where the person is uniquely necessary and you can absorb a 7-12 month gap, then routing everything else through a path that doesn't depend on a lottery.
If a candidate needs sponsorship, can they work for us from their home country instead?
Frequently, yes. That's the whole pivot. Many are already outside the US or on a status that's expiring, and can be engaged at home as a contractor or through an EOR. Ask upfront whether they want US residency, because if they do, this isn't the offer for them.
Is TN worth pursuing for a software engineer?
Only if the duties and degree genuinely line up with a listed profession, usually Computer Systems Analyst or Engineer. When it fits, TN is the fastest and cheapest legal route to US-based work available. When it doesn't, don't force it. Border officers have broad discretion and a denial is immediate.
What's the difference between a nearshore contractor and an EOR?
A contractor is business-to-business: they invoice you, and you carry misclassification and IP-assignment risk if the relationship looks like employment. An EOR legally employs the person in their country, handles payroll and statutory obligations, and assigns work product to you. Contractors start faster; EOR is more durable for long-term core hires.
Does hiring someone in LATAM now help us sponsor them later?
Sometimes. L-1 requires one continuous year of employment abroad with a related corporate entity, so employing them through your own foreign subsidiary may open a path after twelve months. A third-party EOR generally doesn't create that relationship, so structure it deliberately with counsel if a future transfer is part of the plan.
Should we take "no visa sponsorship" off the job posting?
Change what it says. "No visa sponsorship" reads as a closed door; "This role is US-remote, and we also hire across Latin America" reads as two doors. You keep candidates in the funnel who would otherwise self-select out, and you stop losing finalists at the offer stage.
