# Naturalization Application Fee Adjustments > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3A2026-12542 ## Record - **Collection:** Federal Register - **Document type:** Proposed Rule - **Published:** June 23, 2026 - **Citation:** 91 FR 37500 ## Text DEPARTMENT OF HOMELAND SECURITY 8 CFR Part 106 [CIS No. 2834-25; DHS Docket No. USCIS-2026-0265] RIN 1615-AD08 Naturalization Application Fee Adjustments AGENCY: U.S. Citizenship and Immigration Services, Department of Homeland Security. ACTION: Notice of proposed rulemaking. SUMMARY: The Department of Homeland Security (DHS) proposes to adjust the fees that U.S. Citizenship and Immigration Services (USCIS) charges for Form N-400, and Form N-336, to end both the reduced fee option for Form N-400, and the availability of fee waivers for both forms. Current and former armed forces service members would remain exempt from paying the fees when filing for naturalization under statutes for members of the armed forces. The proposed rule is intended to align these fees with the relative costs to adjudicate these forms. DATES: Submission of Public Comments: Written comments must be submitted on or before August 24, 2026. The electronic Federal Docket Management System will accept comments prior to midnight ET at the end of that day. ADDRESSES: You may submit comments on the entirety of this proposed rulemaking package, identified by DHS Docket No. USCIS-2026-0265, through the Federal eRulemaking Portal: https://www.regulations.gov. Follow the website instructions for submitting comments. Comments must be submitted in English, or an English translation must be provided. Comments that will provide the most assistance to USCIS in implementing these changes will reference a specific portion of the proposed rule, explain the reason for any recommended change, and include data, information, or authority that support such recommended change. Comments submitted in a manner other than through the Federal eRulemaking Portal, including emails or letters sent to DHS or USCIS officials, will not be considered comments on the proposed rule and may not receive a response from DHS. Please note that DHS and USCIS cannot accept any comments that are hand-delivered or couriered. In addition, USCIS cannot accept comments contained on any form of digital media storage devices, such as CDs/DVDs and USB drives. USCIS is also not accepting mailed comments at this time. If you cannot submit your comment by using https://www.regulations.gov, please contact the Regulatory Coordination Division, Office of Policy and Strategy, U.S. Citizenship and Immigration Services, Department of Homeland Security, by telephone at (240) 721-3000 for alternate instructions. FOR FURTHER INFORMATION CONTACT: Office of Policy and Strategy, U.S. Citizenship and Immigration Services, Department of Homeland Security, 5900 Capital Gateway Drive, Camp Springs, MD 20746; telephone (240) 721-3000. Individuals with hearing or speech impairments may access the telephone number above via TTY by calling the toll-free Federal Information Relay Service at 711. SUPPLEMENTARY INFORMATION: Table of Contents I. Public Participation II. Executive Summary A. Purpose of the Regulatory Action B. Legal Authority C. Summary of Major Provisions of the Regulatory Action D. Costs and Benefits III. Background and Purpose A. Legal Authority and Immigration Examination Fee Account B. Full Cost Recovery C. Screening and Vetting D. Activity-Based Costing Methodology E. Beneficiary-Pays Principle F. Background on Naturalization G. Background on Fee Waivers H. Recent History of Form N-400 and Form N-336 Fees 1. General Fees 2. Form N-400 Reduced Fee 3. Fee Waivers for Form N-400 and Form N-336 I. Review of Form N-400 and Form N-336 Fees and Calculations of Proposed Fees 1. Volume 2. Cost Projections 3. Revenue Forecast 4. Results of Form N-400 and Form N-336 Fee Review IV. Discussion of Proposed Rule A. Full Cost Recovery for Form N-400 and Form N-336 Fees B. Remove Form N-400 Reduced Fee C. End Fee Waiver Eligibility for Form N-400 and Form N-336 D. Impact of the Proposed Changes E. Retain Fee Exemptions for Armed Forces Service Members F. Scope and Timing of Proposed Changes G. Related Rulemakings H. Severability V. Statutory and Regulatory Requirements A. Executive Orders 12866 (Regulatory Planning and Review), 13563 (Improving Regulation and Regulatory Review), and 14192 (Unleashing Prosperity Through Deregulation) 1. Summary 2. Background and Purpose 3. Population 4. Fee Adjustments 5. Amendments 6. Total Quantified Cost Savings and Transfer Payments 7. Price Elasticity 8. Alternatives B. Regulatory Flexibility Act C. Unfunded Mandates Reform Act of 1995 (UMRA) D. Executive Order 13132 (Federalism) E. Executive Order 12988 (Civil Justice Reform) F. Family Assessment G. Executive Order 13175 (Consultation and Coordination With Indian Tribal Governments) H. National Environmental Policy Act I. Paperwork Reduction Act 1. USCIS Form I-912 2. USCIS Form N-336 3. USCIS Form N-400 Table of Abbreviations ABC Activity-Based Costing BLS Bureau of Labor Statistics CFO Chief Financial Officer CPI-U Consumer Price Index for All Urban Consumers DHS Department of Homeland Security DOL Department of Labor DOW Department of War (also known as the Department of Defense) E.O. Executive Order FASAB Federal Accounting Standards Advisory Board FDNS Fraud Detection and National Security Directorate FPG Federal Poverty Guidelines FY Fiscal Year GAO Government Accountability Office GMC Good Moral Character HHS Department of Health and Human Services HSA Homeland Security Act of 2002 IEFA Immigration Examinations Fee Account INA Immigration and Nationality Act of 1952 IOAA Independent Offices Appropriations Act IRFA Initial Regulatory Flexibility Analysis LPR Lawful Permanent Resident MTB Means-Tested Benefit NEPA National Environmental Policy Act NPRM Notice of Proposed Rulemaking OBBBA One Big Beautiful Bill Act OMB Office of Management and Budget OPQ Office of Performance and Quality PRA Paperwork Reduction Act RFA Regulatory Flexibility Analysis RIA Regulatory Impact Analysis SAM Staffing Allocation Model SBREFA Small Business Regulatory Enforcement Fairness Act of 1996 SIJ Special Immigrant Juvenile SIV Special Immigrant Visa TPS Temporary Protected Status TVPRA Trafficking Victims Protection Reauthorization Act of 2008 UMRA Unfunded Mandates Reform Act of 1995 USCIS U.S. Citizenship and Immigration Services VAWA Violence Against Women Act VPC Volume Projection Committee I. Public Participation DHS invites all interested parties to participate in this rulemaking by submitting written data, views, comments, and arguments on all aspects of this proposed rule. DHS also invites comments that relate to the economic, environmental, or federalism effects that might result from this proposed rule. Comments must be submitted in English, or an English translation must be provided. Comments that will provide the most assistance to USCIS in implementing these changes will reference a specific portion of the proposed rule, explain the reason for any recommended change, and include data, information, or authority that support such recommended change. Comments submitted in a manner other than through the Federal eRulemaking Portal, including emails or letters sent to DHS or USCIS officials, will not be considered comments on the proposed rule and may not receive a response from DHS. Instructions: If you submit a comment, you must include the agency name (U.S. Citizenship and Immigration Services) and the DHS Docket No. USCIS-2026-0265 for this rulemaking. Regardless of the method used for submitting comments or material, all submissions will be posted, without change, to the Federal eRulemaking Portal at https://www.regulations.gov, and will include any personal information you provide. Therefore, submitting this information makes it public. You may wish to consider limiting the amount of personal information that you provide in any voluntary public comment submission you make to DHS. DHS may withhold information provided in comments from public viewing that it determines may impact the privacy of an individual or is offensive. For additional information, please read the Privacy and Security Notice at https://www.regulations.gov. Docket: For access to the docket and to read background documents or comments received, go to https://www.regulations.gov, referencing DHS Docket No. USCIS-2026-0265. You may also sign up for email alerts on the online docket to be notified when comments are posted or a final rule is published. II. Executive Summary DHS proposes to adjust the fees for Form N-400, Application for Naturalization, and Form N-336, Request for a Hearing on a Decision in Naturalization Proceedings Under Section 336, in the USCIS Fee Schedule. 1 DHS's last comprehensive adjustment to the USCIS fee schedule occurred on January 31, 2024, and took effect on April 1, 2024. See 89 FR 6194 (Jan. 31, 2024) (2024 Fee Rule). 2 1 See USCIS, Form G-1055, “Fee Schedule,” https://www.uscis.gov/g-1055 (Oct. 28, 2025 ed.). 2 DHS subsequently published two corrections. See 89 FR 20101 (Mar. 21, 2024); 90 FR 5519 (Jan. 17, 2025). USCIS is primarily funded by immigration and naturalization benefit request fees charged to applicants and petitioners. Fees collected from individuals and entities filing immigration benefit requests are deposited into the Immigration Examinations Fee Account (IEFA). These fee collections fund the cost of fairly and efficiently adjudicating immigration benefit requests, including those provided without charge to certain benefit requestors. The proposed fees for Form N-400 and Form N-336 would recover the full costs associated with adjudicating these forms according to the beneficiary-pays principle. This proposed rule also would eliminate fee waivers for both forms and the reduced fee for aliens and U.S. nationals 3 filing Form N-400. Qualified current and former armed forces service members would still be exempt from paying the fees for Form N-400 and Form N-336 because these fee exemptions are required by statute. See INA sec. 328(b)(4), 8 U.S.C. 1439(b)(4); INA sec. 329(b)(4), 8 U.S.C. 1440(b)(4). 3 An alien is defined as a person not a citizen or national of the United States. See Immigration and Nationality Act (INA) sec. 101(a)(3), 8 U.S.C. 1101(a)(3). However, nationals of the United States who are not citizens may also apply for naturalization under the INA. The INA defines a national of the United States as either a U.S. citizen or “a person who, though not a citizen of the United States, owes permanent allegiance to the United States.” See INA sec. 101(a)(22), 8 U.S.C. 1101(a)(22). For ease of reading this preamble, the preamble will refer to “alien” or “applicant,” although the descriptions equally apply to U.S. nationals who are not U.S. citizens. A. Purpose of the Regulatory Action The purpose of this proposed rule is to adjust the fees for Form N-400 and Form N-336, including eliminating fee waivers and reduced fees for these forms, so that their fees recover the full cost of their adjudication, according to the beneficiary-pays approach to fee setting. These proposed changes aim to align the fees for Form N-400 and Form N-336 with the costs of processing those forms, while maintaining statutory compliance and supporting USCIS' financial sustainability. USCIS continually works to improve the integrity of the U.S. naturalization system and ensure full compliance with current naturalization laws. The current fees for Form N-400 and Form N-336 do not recover the full cost of thoroughly adjudicating applications for naturalization, including necessary screening and vetting checks, which USCIS is continuously enhancing consistent with the President's Executive Orders. On January 20, 2025, the President signed multiple Executive Orders related to immigration and naturalization policy. Executive Order (E.O.) 14161, Protecting the United States From Foreign Terrorists and Other National Security and Public Safety Threats, section 2, instructs DHS to coordinate with the Secretary of State to “vet and screen to the maximum degree possible” all aliens who are already in the United States, and identify all resources that may be used to do so. See 90 FR 8451, 8451 (Jan. 30, 2025). Section 3(f) of E.O. 14161 also instructs DHS to coordinate with the Secretary of State to “recommend any additional measures to be taken that promote a unified American identity and attachment to the Constitution, laws, and founding principles of the United States.” 90 FR 8451, 8452. In addition, E.O. 14159, Protecting the American People Against Invasion, 90 FR 8443 (Jan. 29, 2025), revoked E.O. 14012, Restoring Faith in Our Legal Immigration Systems and Strengthening Integration and Inclusion Efforts for New Americans, 86 FR 8277 (Feb. 5, 2021), and instructs DHS to take all appropriate action to promptly revoke all policies that were issued based on E.O. 14012. 4 On March 25, 2025, the President signed E.O. 14248, Preserving and Protecting the Integrity of American Elections, to prioritize vetting voters' citizenship and imposing actions against aliens who falsely claim U.S. citizenship to register or vote. See 90 FR 14005 (Mar. 28, 2025). On August 25, 2025, the President signed E.O. 14341, Prosecuting Burning of the American Flag, 90 FR 42127 (Aug. 28, 2025). Section 2(d) of the E.O. instructs DHS to deny naturalization proceedings when a foreign national has engaged in American Flag-desecration activity under circumstances that permit the exercise of such remedies pursuant to Federal law. See 90 FR 42127, 42127-42128. As discussed further in Section IV.F of this preamble, DHS has already announced various changes to the naturalization process, which are expected to require additional resources for USCIS to process Form N-400 and Form N-336. 4 See also 90 FR 8237 (Jan. 28, 2025) (also revoking E.O. 14012). Section 5, Promoting Naturalization, of E.O. 14012 instructed DHS to develop a plan to make the naturalization process more accessible to all eligible individuals, including through a potential reduction of the naturalization fee and restoration of the fee waiver process. See 86 FR 8277. The proposed fee changes would align the fees for processing Form N-400 and Form N-336 with the current, known, projected costs of processing Form N-400 and Form N-336. Fees that do not fully recover the adjudicative costs, combined with the availability of fee waivers for Form N-400 and Form N-336, have led DHS to raise fees for other benefit requests to make up the difference. 5 Increasing fees and eliminating fee waivers for Form N-400 and Form N-336 would close the cost/revenue gap from these forms that is currently filled by fees charged to other benefit requestors. 5 See 88 FR 402, 486-489 (Jan. 4, 2023); 89 FR 6194, 6241; USCIS, DHS, “Use of Fee Waivers: Policy and Data, Fourth Quarter, Fiscal Year 2023” (Mar. 22, 2024), https://www.dhs.gov/sites/default/files/2024-04/2024_0415_uscis_use_of_fee_waivers_q4_0.pdf; see also 89 FR 6194, 6249-6254 (commenting on USCIS processing times and backlogs). Although DHS has historically limited the fees for Form N-400 and Form N-336 to fulfill previous administrations' priorities of encouraging naturalization ( see 88 FR 402, 485-489 (Jan. 4, 2023) (2023 Proposed Fee Rule); 89 FR 6194, 6300-6301 (2024 Fee Rule)), DHS no longer believes naturalization benefit requests should get lower fees at the potential expense of other immigration benefits, as discussed in Section IV.A of this preamble. B. Legal Authority DHS issues this proposed rule consistent with its authority under various sections of the Immigration and Nationality Act (INA or the Act), 8 U.S.C. 1101, et seq., and the Homeland Security Act of 2002 (HSA), Public Law 107-296, 116 Stat. 2135 (codified in part at 6 U.S.C. 101 et seq. ). Specifically, these statutes include: 6 U.S.C. 112; INA sec. 103(a), 8 U.S.C. 1103(a); INA sec. 286(j) and (m), 8 U.S.C. 1356(j) and (m); INA sec. 344, 8 U.S.C. 1455 (referencing 31 U.S.C. 9701); and 31 U.S.C. 901-03. C. Summary of the Major Provisions of the Regulatory Action DHS proposes the following changes to the fees for Form N-400 and Form N-336: • Adjust the fee for Form N-400 to $1,330 (paper filings) and $1,280 (online filings) 6 to recover the full cost of adjudicating the form while maintaining the fee exemptions for military service members applying under section 328 or 329 of the INA, 8 U.S.C. 1439, 1440. See proposed 8 CFR 106.2(b)(3); 6 DHS is not proposing to change the $50 discount for filing Form N-400 and Form N-336 online pursuant to 8 CFR 106.1(g). • Adjust the fee for Form N-336 to $1,475 (paper filings) and $1,425 (online filings) to recover the full cost of adjudicating the form while maintaining fee exemptions for military service members applying for naturalization under section 328 or 329 of the INA, 8 U.S.C. 1439, 1440. See proposed 8 CFR 106.2(b)(2); • Eliminate the reduced fee for Form N-400 for aliens whose household income is less than or equal to 400 percent of the Federal Poverty Guidelines (FPG). See proposed 8 CFR 106.2(b)(3); and • Eliminate eligibility for fee waivers for aliens filing Form N-400 or Form N-336. See proposed 8 CFR 106.3(a)(3)(i). EP23JN26.000 D. Costs and Benefits Fee increases for Form N-400 and Form N-336 would result in annualized transfer payments from current full fee-paying alien applicants to USCIS of approximately $430,049,505 (primary estimate, discounted at 3 and 7 percent). The total 10-year transfer payments from current full fee-paying alien applicants to USCIS would be $3,668,409,508 (primary estimate) at a 3 percent discount rate and $3,020,487,765 (primary estimate) at a 7 percent discount rate. The fee waiver amendments for Form N-400 and Form N-336 would result in annualized transfer payments from current fee-waiver eligible aliens to USCIS of approximately $196,353,305 (primary estimate, discounted at 3 and 7 percent). The total 10-year transfer payments from current fee-waiver eligible aliens to USCIS would be $1,674,933,519 (primary estimate) at a 3 percent discount rate and $1,379,103,448 (primary estimate) at a 7 percent discount rate. The reduced fee amendment for Form N-400 would result in annualized transfer payments from current reduced fee eligible aliens to USCIS of approximately $16,730,450 (primary estimate, discounted at 3 and 7 percent). The total 10-year transfer payments from current reduced fee eligible aliens to USCIS would be $142,714,132 (primary estimate) at a 3 percent discount rate and $117,507,680 (primary estimate) at a 7 percent discount rate. The fee waiver and reduced fee amendments for Form N-400 and Form N-336 would result in opportunity cost savings for aliens who are no longer eligible for the waived or reduced fees and do not need to fill out Form I-912 or Part 10 of Form N-400 of approximately $3,514,895 (primary estimate, discounted at 3 and 7 percent). The total 10-year cost savings for aliens would be $29,982,767 (primary estimate) at a 3 percent discount rate and $24,687,152 (primary estimate) at a 7 percent discount rate. This proposed rule would set the fees for Form N-400 and Form N-336 to recover the cost of adjudicating and processing both forms, including performing screening and vetting checks which USCIS is continuously enhancing, allowing USCIS to improve the integrity of the U.S. naturalization system and ensure full compliance with current naturalization laws and the President's Executive Orders. DHS anticipates this proposed rule would produce a qualitative benefit for USCIS by substantially reducing resources that would have been expended on adjudicating and processing fee waiver and reduced fee requests. Qualitatively, the proposed rule would also reduce administrative costs to adjudicate Forms I-912, N-400, and N-336 that are submitted by aliens ineligible for naturalization or a fee waiver, and who may know they are not eligible, but who file the application anyway because it would potentially be free if USCIS ultimately approved the fee waiver. 7 Additionally, it reduces the administrative costs of adjudicating reduced fee requests that are submitted by aliens who are ineligible for naturalization or a reduced fee, and may know they are not eligible, but file the request anyway. On the other hand, increasing general fees and eliminating fee waivers and reduced fees might cause certain aliens who are eligible to become naturalized U.S. citizens to delay applying and paying the increased fee. This could result in additional lawful permanent resident (LPR) requests in the future for renewal of their Permanent Resident Cards (“Green” Card) which would be an added burden to applicants and USCIS. 7 Form I-912, or a fee waiver request, must be submitted together with Form N-400 or with Form N-336. Form I-912 is adjudicated before the Form N-400 or Form N-336 is adjudicated. If the Form I-912 is approved, USCIS will issue a receipt notice for the Form N-400 or Form N-336 and proceed with adjudicating Form N-400 or Form N-336. If the Form I-912 is denied, the entire application package will be returned to the applicant. See USCIS, Form I-912, “Instructions for Request for Fee Waiver,” https://www.uscis.gov/sites/default/files/document/forms/i-912instr.pdf (July 22, 2025 ed.). III. Background and Purpose A. Legal Authority and Immigration Examination Fee Account The Secretary's authority for the regulatory amendments made in this proposed rule are found in various sections of the INA, 8 U.S.C. 1101, et seq., and the Homeland Security Act of 2002 (HSA), Public Law 107-296, 116 Stat. 2135 (codified in part at 6 U.S.C. 101 et seq. ). General authority for issuing regulations is found in section 103(a) of the INA, 8 U.S.C. 1103(a), which authorizes the Secretary to administer and enforce the immigration and nationality laws and establish such regulations as the Secretary deems necessary for carrying out such authority, as well as section 102 of the HSA, 6 U.S.C. 112, which vests all of the functions of DHS in the Secretary and authorizes the Secretary to issue regulations. 8 Section 286(m) of the INA, 8 U.S.C. 1356(m), authorizes the Secretary to set “fees for providing adjudication and naturalization services . . . at a level that will ensure recovery of the full costs of providing all such services, including the costs of similar services provided without charge to asylum applicants or other immigrants.” 9 Section 286(j) of the INA, 8 U.S.C. 1356(j), provides specific authority for the Secretary to prescribe rules and regulations as may be necessary to carry out the fee provisions of section 286 of the INA, 8 U.S.C. 1356. Section 344 of the INA, 8 U.S.C. 1455, requires the Secretary to charge and collect fees related to naturalizations, consistent with the principles outlined in 31 U.S.C. 9701. 10 Section 344(c) of the INA further specifies that, with a few exceptions, the fees collected related to naturalization must be deposited in the IEFA under section 286(m) of the INA, 8 U.S.C. 1356(m). Moreover, 31 U.S.C. 9701 provides broad authority to the head of each agency (except a mixed-ownership Government corporation) to prescribe regulations establishing the charge for a service or thing of value provided by the agency and stipulates that these regulations prescribed by the heads of executive agencies are subject to policies prescribed by the President and shall be as uniform as practicable. It further prescribes that the charge shall be fair and based on the costs to the Government, the value of the service or thing to the recipient, public policy or interest served, and other relevant facts ( see 31 U.S.C. 9701(b)), in accordance with the sense of Congress that each service or thing of value provided by an agency to a person is to be self-sustaining to the extent possible. 8 As of March 1, 2003, the former Immigration and Naturalization Service (INS) ceased to exist as an agency within the United States Department of Justice (DOJ) and its functions regarding the applications for immigration benefits and naturalizations were transferred to the United States Citizenship and Immigration Services in the United States Department of Homeland Security. See HSA secs. 451(b) and 471, 6 U.S.C. 271(b), 291. Although several provisions of the INA discussed in this proposed rule refer exclusively to the “Attorney General,” such provisions are now to be read as referring to the Secretary of Homeland Security by operation of the HSA. See, e.g., INA secs. 103(a)(1), 286, 344, 8 U.S.C. 1103(a)(1), 1356, 1455; Nielsen v. Preap, 139 S. Ct. 954, 959 n.2 (2019). 9 The longstanding interpretation of DHS is that the “including” clause in INA sec. 286(m), 8 U.S.C. 1356(m), does not constrain DHS's fee authority under the statute. The “including” clause offers only a non-exhaustive list of some of the costs that DHS may consider part of the full costs of providing adjudication and naturalization services. See INA sec. 286(m), 8 U.S.C. 1356(m); 84 FR 23930, 23932 n.1 (May 23, 2019); 81 FR 26904, 26906 n.10. 10 Consistent with prior rulemakings DHS does not interpret 31 U.S.C. 9701 as providing independent authority for DHS to set USCIS fees. See 89 FR 6194, 6246 (Jan. 31, 2024). Most U.S. government agencies that charge fees do so under the Independent Offices Appropriations Act (IOAA), codified at 31 U.S.C. 9701 (providing, inter alia, that “[e]ach charge shall be . . . based on . . . the costs to the Government [and] the value of the service or thing to the recipient”). However, in lieu of appropriations, Congress has directed that immigration benefits be funded with fees. See Depts. of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act for 1989, Public Law 100-459, sec. 209, 102 Stat. 2186 (1988) (codified at INA sec. 286(m), 8 U.S.C. 1356(m)). However, INA sec. 344(a), 8 U.S.C. 1455, incorporates the guidance in 31 U.S.C. 9701 by reference. On October 24, 1988, Congress amended INA sec. 344(a), 8 U.S.C. 1455, by inserting the reference to 31 U.S.C. 9701. See Public Law 100-525, sec. 9(ff), 102 Stat. 2609 (1988). In 1990, without modifying section 344 of the INA, 8 U.S.C. 1455, Congress amended INA sec. 286(m), 8 U.S.C. 1356(m) and directed that the Immigration Examinations Fee Account (IEFA) fund the full costs of providing “adjudication and naturalization services,” including services provided to immigrants at no charge, see Public Law 101-515, sec. 210(d)(1) and (2), 104 Stat. 2101, 2121 (Nov. 5, 1990), thereby providing broad statutory authority to consider all factors enumerated in INA secs. 286(m) and 344, 8 U.S.C. 1356 and 1455, as well as 31 U.S.C. 9701. The CFO Act, 31 U.S.C. 901-03, requires USCIS' Chief Financial Officer (CFO), among other things, to review on a biennial basis the fees imposed by the agency for services it provides and to recommend changes to its fees. The CFO Act's biennial review requirement is the minimum frequency required by a fee- funded agency, so it permits DHS to adjust USCIS fees more often than biennially as needed. 11 Furthermore, the CFO Act requires the CFO to direct, manage, and provide policy guidance and oversight of agency financial management, personnel, activities, and operations. See 31 U.S.C. 902(a)(5). 11 See 31 U.S.C. 902(a)(8) (“An Agency Chief Financial Officer shall . . . review, on a biennial basis, the fees, royalties, rents and other charges imposed by the agency for services and things of value it provides . . .”). USCIS is primarily funded by fees charged to applicants, petitioners, and requestors for immigration and naturalization benefit requests. USCIS manages the following four fee accounts: • The IEFA, which includes premium processing revenues (INA sec. 286(m), (n), (t), and (u); 8 U.S.C. 1356(m), (n), (t), and (u)); • The Fraud Prevention and Detection Account (INA secs. 214(c)(12) and (13), 286(v); 8 U.S.C. 1184(c)(12) and (13), 1356(v)); • The H-1B Nonimmigrant Petitioner Account (INA secs. 214(c)(9) and (11), 286(s); 8 U.S.C. 1184(c)(9) and (11), 1356(s)); and • The EB-5 Integrity Fund (INA sec. 203(b)(5)(J), 8 U.S.C. 1153(b)(5)(J)). In 1988, Congress established the IEFA in the Treasury of the United States. See Public Law 100-459, sec. 209, 102 Stat. 2186 (Oct. 1, 1988) (codified as amended at INA sec. 286(m) and (n), 8 U.S.C. 1356(m) and (n)). Fees deposited into the IEFA fund adjudication and naturalization services. In subsequent legislation, Congress directed that the IEFA fund the full costs of providing all such services, including services provided to immigrants at no charge. See Public Law 101-515, sec. 210(d)(1) and (2), 104 Stat. 2101, 2121 (Nov. 5, 1990). Consequently, the immigration benefit fees were increased to recover these additional costs. See 59 FR 30520 (June 14, 1994). In FY 2024, the IEFA accounted for approximately 94 percent of total funding for USCIS, or $5.9 billion out of the $6.3 billion in total USCIS funding. The remaining USCIS funding came from appropriations (approximately 5 percent or $0.3 billion) or other fee accounts (approximately 1 percent or $0.1 billion) in FY 2024. 12 The Fraud Prevention and Detection Account 13 and H-1B Nonimmigrant Petitioner Account 14 are both funded by fees for which the dollar amount is set by statute. DHS has no authority to adjust the fees for these accounts. The EB-5 Integrity Fund, a new fee account established in FY 2023, uses initial fees set by statute. 12 See DHS, “Fiscal Year 2026 Budget in Brief” (July 3, 2025), https://www.dhs.gov/sites/default/files/2025-07/2025_07_03_ocfo_fy-2026-budget-in-brief.pdf. 13 The Fraud Prevention and Detection fees charged to certain employers petitioning for nonimmigrant workers in the H-1B, H-2B, and L-1 visa classifications are set by statute. Revenue is used for activities related to preventing and detecting fraud in immigration benefit requests. See INA sec. 286(v)(2)(B), 8 U.S.C. 1356(v)(2)(B). Revenue is shared equally among USCIS, Department of State, and Department of Labor. Effective July 25, 2018, USCIS also collects and retains the $50 Commonwealth of the Northern Mariana Islands fraud fee. See 48 U.S.C. 1806(a)(6)(iv). DHS interprets Fraud Prevention and Detection Account authority as providing supplemental funding to cover activities related to fraud prevention and detection and not prescribing that only those funds may be used for that purpose. The Fraud Detection and National Security Directorate (FDNS) is funded out of both the IEFA and the Fraud Prevention and Detection Account. 14 Certain H-1B fees are required by other laws. Revenue is shared among USCIS, DOL, and the National Science Foundation. USCIS receives 5 percent of these funds. USCIS uses the H-1B Nonimmigrant Petitioner Account as supplemental funding for the limited H-1B petition and petition for immigrant worker adjudication activities authorized by statute. See INA sec. 286(s)(5), 8 U.S.C. 1356(s)(5). The H-1B Nonimmigrant Petitioner Account does not fully fund the H-1B program at USCIS. As such, USCIS also uses IEFA fees to administer the program. IEFA fees are not required for those limited purposes authorized or required by INA sec. 286(s)(5), 8 U.S.C. 1356(s)(5). B. Full Cost Recovery USCIS receives millions of requests each year for immigration benefits, 15 including nearly one million Form N-400 submissions and thousands of Form N-336 submissions. 16 These benefits are funded, generally, by charging fees for USCIS services. However, the costs incurred by USCIS for processing Form N-400 and Form N-336 exceed the fee revenue generated from the filing of these forms. See Section III.H and I. 15 Benefit request means any application, petition, motion, appeal, or other request relating to an immigration or naturalization benefit, whether such benefit is filed on paper form or submitted in an electronic format, provided such request is submitted in a manner prescribed by DHS for such purpose. See 8 CFR 1.2. 16 See USCIS, DHS, “Number of Service-wide Forms, By Quarter, Form Status, and Processing Time, July 1, 2024-Sept. 30, 2024” (Dec. 18, 2024), https://www.uscis.gov/sites/default/files/document/data/quarterly_all_forms_fy2024_q4.xlsx. DHS is authorized to charge fees that ensure the full recovery of the costs associated with providing immigration and naturalization services, either for select immigration benefits, 17 or the general costs associated with providing all adjudication and naturalization services. As explained more fully below, USCIS is primarily fee-funded, so it must also ensure that it maintains a sufficient carryover balance 18 to continue operating. “[F]ull costs” in section 286(m) of the INA, 8 U.S.C. 1356(m), necessarily includes support costs, such as physical overhead, information technology, management and oversight, human resources, national security vetting and investigations, accounting and budgeting, and legal, for example. USCIS revenue carryover provides financial flexibility to manage the unpredictable nature of immigration service demand while maintaining accountability through congressional oversight. 19 Unlike most Federal agencies, USCIS is allowed to retain unspent fee revenue from one fiscal year for use in future years. 20 17 USCIS has in the past set fees on a small or individual basis, instead of comprehensively based on all USCIS services. See, e.g., “Registration Fee Requirement for Petitioners Seeking To File H-1B Petitions on Behalf of Cap Subject Aliens,” 84 FR 46460 (Sept. 4, 2019) (proposed rule); “International Entrepreneur Rule,” 81 FR 60130 (Aug. 31, 2016) (proposed rule); “Provisional Unlawful Presence Waivers of Inadmissibility for Certain Immediate Relatives,” 77 FR 19902 (Apr. 2, 2012) (proposed rule). 18 Carryover balance refers to the unobligated or unexpended fee revenue accumulated from previous fiscal years. See 88 FR 402, 417. 19 DHS must submit annual statements of financial condition of the IEFA Account to Congress, including information on carryover balances, revenues, withdrawals, and projections for the ensuing fiscal year. INA sec. 286(o), 8 U.S.C. 1356(o). 20 See 8 U.S.C. 1356(n) (stating, “deposits into the Immigration Examinations Fee Account shall remain available until expended”). To set fees for immigration benefit requests, DHS generally relies on OMB Circular A-25, 21 which advises that each service provided by an agency should be self-sustaining and charges for benefits should be at least as great as the costs to the Government of providing them. 22 OMB Circular A-25 also specifies that, when the Government is supplying a special benefit to an identifiable recipient that also provides an incidental benefit to the public, the agency need not allocate costs to the public and should seek to recover from the recipient the full cost of providing the benefit, as applicable. 23 In addition, DHS adheres to the Statement of Federal Financial Accounting Standards 4 in assessing USCIS' full costs. 24 21 See OMB Circular A-25, “User Charges,” 58 FR 38142 (July 15, 1993) (revising Federal policy guidance regarding fees assessed by Federal agencies for Government services). 22 See OMB Circular A-25, section 5(a) and (b). The primary objective of OMB Circular A-25 is to ensure that Federal agencies recover the full cost of providing specific services to users and associated cost. See OMB Circular A-25, 58 FR 38142, 38144. Full costs include, but are not limited to: (1) Direct and indirect personnel costs, including salaries and fringe benefits, such as medical insurance and retirement; (2) Physical overhead, consulting, and other indirect costs, including material and supply costs, utilities, insurance, travel, and rents or imputed rents on land, building, and equipment; (3) Management and supervisory costs; and (4) Cost of enforcement, collection, research, and establishment of standards and regulations. See id., section 6, 58 FR 38142, 38145. 23 See OMB Circular A-25, section 6(a)(3), 58 FR 38142, 38145. OMB Circular A-25 specifies that market price is to be used in situations when the Government is not acting as sovereign, which is not the case for immigration benefit requests. 24 See FASAB, Federal Accounting Standards Advisory Board Handbook, Version 23 (09/24), “Statement of Federal Financial Accounting Standards 4: Managerial Cost Accounting Standards and Concepts,” SFFAS 4 (July 31, 1995), https://files.fasab.gov/pdffiles/handbook_sffas_4.pdf (generally describing cost accounting concepts and standards, and defining “full cost” to mean the sum of direct and indirect costs that contribute to the output, including the costs of supporting services provided by other segments and entities); see also id. at 49-66 (identifying various classifications of costs to be included and recommending various methods of cost assignment). C. Screening and Vetting DHS notes that the work to perform screening and vetting, background checks, site visits, and investigations is needed to properly perform adjudication and naturalization services, and therefore may be recovered as part of full cost recovery. The Secretary, in Homeland Security Delegation No. 0150.1, delegated USCIS the authority to investigate alleged civil and criminal violations of the immigration laws, including but not limited to alleged fraud with respect to applications or determinations by USCIS and to make recommendations for prosecutions, or other appropriate action when deemed advisable. The activities of the Fraud Detection and National Security (FDNS) Directorate fall squarely within this delegation. 25 Conducting anti-fraud, law enforcement, and background checks on every applicant, beneficiary, and petitioner before granting immigration benefits fulfills the USCIS mission of enhancing both national security and the integrity of the legal immigration system. These pre-approval and post-approval screening and vetting activities are sufficiently related to adjudication services to allow their funding from IEFA fees. 25 DHS, Delegation 00150.1, Delegation to the Bureau of Citizenship and Immigration Services, June 5, 2003, on file with USCIS; see also DHS, Delegation 15006, Delegation to Director, USCIS, To Order Expedited Removal and to Enforce Immigration Laws, May 2, 2025, on file with USCIS (delegating authority to investigate alleged civil and criminal violations of the immigration laws within the jurisdiction of USCIS). D. Activity-Based Costing Methodology To determine the fees necessary to recover the full costs of adjudication and naturalization services, USCIS employs an Activity-Based Costing (ABC) methodology. This cost accounting method assigns resource costs to operational activities and allocates them to specific immigration benefit requests, including biometric services. USCIS uses commercially available ABC software 26 to create financial models that calculate the cost of each major step in processing benefit requests. This methodology, used in the last fee reviews, forms the basis of the current fee structure and ensures fees recover the full costs of providing services, consistent with 286(m) of the INA, 8 U.S.C. 1356(m). 27 26 USCIS uses CostPerform. For information from the vendor on this commercial, off-the-shelf application, visit https://www.costperform.com (last visited Oct. 7, 2025). 27 Two of the last eight fee reviews did not result in fee changes. However, DHS revised USCIS fees five times based on fee review results that used similar methodology to this one. See 72 FR 29851 (May 30, 2007); 75 FR 58962 (Sept. 24, 2010); 81 FR 73292 (Oct. 24, 2016); 85 FR 46788 (Aug. 3, 2020); 89 FR 6194 (Jan. 31, 2024). Building on this foundation, USCIS identifies all major steps involved in processing immigration benefit requests, including intake, biometrics collection, background checks, adjudication, and notification of decisions. 28 Each activity is analyzed to determine the resources consumed, such as personnel time, technology infrastructure, and physical overhead. These resources are then allocated to specific forms and services based on their proportional workload required to deliver the USCIS mission. Furthermore, this methodology accounts for cost drivers that influence the overall expense of processing benefit requests, including application volumes and trends, the complexity of adjudication, inflationary pressures on labor and technology, and policy changes that require operational adjustments. Overhead costs, such as management and oversight, information technology systems, human resources, and legal and regulatory compliance, are also incorporated into the cost model and distributed across all forms and services. 28 DHS summarizes the fee-setting inputs, process, and calculations in this proposed rule and provides detailed analysis of the proposed fees for Form N-400 and Form N-336 in the supporting documentation, which is available in the rulemaking docket for the affected public to read and comment. See N-336 and N-400 Fee Review Supporting Documentation, Naturalization Application Fee Adjustments Rule, Notice of Proposed Rulemaking, in the DHS Docket No. USCIS-2026-0265. In addition to analyzing operational activities, USCIS conducts a detailed analysis of each form to determine its unique cost structure. Form N-400 involves the following: Biometric Services and Identity Verification: USCIS collects, stores, uses, and reuses biometric data for aliens seeking naturalization. Biometric services support background checks conducted by the Federal Bureau of Investigation (FBI) and identity verification of aliens applying for naturalization. 29 29 See 8 CFR 103.2(b)(9), 103.16, 103.17, 335.1 and 335.2; USCIS, DHS, “USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part B, Naturalization Examination, Chp. 2, Background and Security Checks, https://www.uscis.gov/policy-manual/volume-12-part-b-chapter-2 (last updated Dec. 22, 2025). Extensive background checks and national security vetting: In addition to FBI fingerprint checks, USCIS runs checks on aliens seeking naturalization through the FBI's National Name Check Program (NNCP). This searches against the FBI's Universal Index (UNI), which contains personnel, administrative, applicant, and criminal files compiled for law enforcement purposes. 30 Background checks also include TECS checks, which compare information on aliens seeking naturalization against various Federal Government systems. 31 Not only does USCIS conduct background checks during adjudication of Form N-400, but also prior to an alien taking the oath of allegiance. 32 FDNS develops policies, procedures, and programs designed to detect, deter, and administratively investigate naturalization fraud; develops and implements security screening policies, programs, and procedures for aliens seeking naturalization; establishes guidance and oversees processes for identifying, reviewing, vetting, and adjudicating cases involving national security concerns; and serves as USCIS' primary conduit for information sharing and collaboration with law enforcement and the Intelligence Community. 33 30 Id. 31 See 73 FR 77778 (Dec. 19, 2008). 32 See INA sec. 337, 8 U.S.C. 1448; USCIS, DHS, “USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part J, Oath of Allegiance, Chp. 4, General Considerations for All Oath Ceremonies, Section B. Derogatory Information Received before Oath or Failure to Appear, https://www.uscis.gov/policy-manual/volume-12-part-j-chapter-4 (last updated Dec. 22, 2025). 33 USCIS established FDNS in 2004 in response to a Congressional recommendation to establish an organization “responsible for developing, implementing, directing, and overseeing the joint USCIS-Immigration and Customs Enforcement (ICE) anti-fraud initiative and conducting law enforcement/background checks on every applicant, beneficiary, and petitioner prior to granting immigration benefits.” Conference Report to accompany H.R. 4567 [Report 108-774], “Making Appropriations for the Department of Homeland Security for the Fiscal Year Ending September 30, 2005,” p. 74, https://www.gpo.gov/fdsys/pkg/CRPT-108hrpt774/pdf/CRPT-108hrpt774.pdf; see also USCIS, DHS, “Fraud Detection and Nat'l Security Directorate,” https://www.uscis.gov/about-us/organization/directorates-and-program-offices/ fraud-detection-and-national-security-directorate (last updated May 28, 2025); USCIS, “Fraud Detection and Nat'l Security Directorate (FDNS),” May 2022, https://www.uscis.gov/sites/default/files/document/brochures/FDNS_Brochure_Web_V2_508.pdf. Interviews: USCIS conducts at least one in-person interview of every alien applying for naturalization, which typically includes administering the English and civics test. 34 Form N-400 adjudications routinely involve multiple interviews by USCIS, such as when the alien fails any portion of the English or civics tests during the first interview, 35 or when the officer needs to take a sworn statement, which may be particularly important in complex cases, such as those involving national security or fraud concerns. 36 34 INA sec. 312(a), 332, 335, 8 U.S.C. 1423, 1443, 1446; 8 CFR 335.2(a). 35 See 8 CFR 312.5(a). 36 See USCIS, DHS, “USCIS Policy Manual,” Vol. 1, General Policies and Procedures, Part E, Adjudication, Chp. 6, Evidence, Sec. D, Types of Evidence, Subsec. 2, Testimonial Evidence, https://www.uscis.gov/policy-manual/volume-1-part-e-chapter-6 (last updated Dec. 22, 2025). Complicated Adjudication Process: Adjudication of Form N-400 typically includes a full review of the alien's entire immigration history 37 and international travel history during the applicable statutory period (usually 5 years), 38 and an evaluation of the alien's character to ensure that he or she is a person of good moral character (GMC), attached to the U.S. Constitution, and well disposed to the good order and happiness of the United States. 39 Additional adjudication activities can include making and recording adjudicative decisions, requesting and reviewing additional evidence, consulting with supervisors or legal counsel, and researching applicable laws and decisions for non-routine cases. For more on the legal requirements for naturalization, see Section III.F., Background on Naturalization. 37 See USCIS, DHS, “USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part B, Naturalization Examination, Chp. 3, Naturalization Interview, Section B, Preliminary Review of Application, https://www.uscis.gov/policy-manual/volume-12-part-b-chapter-3 (last updated Dec. 22, 2025). 38 See INA sec. 316(a), 8 U.S.C. 1427; USCIS, DHS, “USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part D, General Naturalization Requirements, Chp. 3, Continuous Residence, and Chp. 4, Physical Presence, https://www.uscis.gov/policy-manual/volume-12-part-d (last updated Dec. 22, 2025). 39 See INA sec. 316(a), 8 U.S.C. 1427(a); USCIS, DHS, “USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part F, Good Moral Character, https://www.uscis.gov/policy-manual/volume-12-part-f (last updated Dec. 22, 2025). Public Oath Ceremony: Most aliens who meet the eligibility requirements for naturalization acquire their citizenship at a public ceremony where they take the oath of allegiance to the United States. 40 USCIS also completes additional background checks before an Oath Ceremony. USCIS conducts ceremonies in such a manner as to preserve the dignity and significance of the occasion. 41 40 See INA sec. 337, 8 U.S.C. 1448. 41 See INA sec. 337, 8 U.S.C. 1448; USCIS, DHS, “USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part J, Oath of Allegiance, Chp. 4, General Considerations for All Oath Ceremonies, https://www.uscis.gov/policy-manual/volume-12-part-j-chapter-4 (last updated Dec. 22, 2025). All of these activities contribute to the processing costs for Form N-400. Form N-336 includes many of the same cost activities, including biometric services and identity verification, 42 and additional background checks and national security vetting. 43 The adjudication process for Form N-336 builds on the complex adjudication process required for Form N-400, since the officer determines whether to conduct a: (1) de novo ( i.e., new and full) review of Form N-400, or (2) use a less formal review procedure based on the record, the complexity of issues to be reviewed or determined, and upon the necessity of conducting further examinations with respect to essential naturalization requirements. 44 The officer conducting the review administers any portions of the English or civics tests that the alien previously failed. 45 In addition to reviewing the evidence submitted for the underlying Form N-400, the reviewing officer may receive additional evidence and accept new testimony. 46 42 See 8 CFR 103.2(b)(9); USCIS, Form N-336, “Instructions for Request for Hearing on a Decision in Naturalization Proceedings Under Section 336,” https://www.uscis.gov/n-336 (Apr. 1, 2024 ed.). 43 See 8 CFR 103.2(b)(9); USCIS, Form N-336, “Instructions for Request for Hearing on a Decision in Naturalization Proceedings Under Section 336,” https://www.uscis.gov/n-336 (Apr. 1, 2024 ed.). 44 See 8 CFR 336.2(b); USCIS, DHS, “USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part B, Naturalization Examination, Chp. 6, USCIS Hearing and Judicial Review, Section B, Timely Filed Hearing Request, https://www.uscis.gov/policy-manual/volume-12-part-b-chapter-6 (last updated Feb. 3, 2026). 45 See USCIS, DHS, “USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part B, Naturalization Examination, Chp. 6, USCIS Hearing and Judicial Review, Section B, Timely Filed Hearing Request, Subsection 3, English and Civics Testing at Hearing, https://www.uscis.gov/policy-manual/volume-12-part-b-chapter-6 (last updated Feb. 3, 2026). 46 See 8 CFR 336.2(b); USCIS, DHS, “USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part B, Naturalization Examination, Chp. 6, USCIS Hearing and Judicial Review, Section B, Timely Filed Hearing Request, Subsection 2, Review of Application, https://www.uscis.gov/policy-manual/volume-12-part-b-chapter-6 (Feb. 3, 2026). To ensure fees are aligned with costs, USCIS uses the ABC methodology to evaluate whether current fees recover the full proportional costs of adjudicating each form. This process involves collecting historical data on processing times, resource use, and application volumes; developing financial models using commercially available ABC software to simulate the cost of processing each form; comparing estimated costs to revenue projections using current fees to identify gaps in cost recovery; and adjusting fees as necessary to ensure full cost recovery. After the ABC model generates cost outputs for every USCIS form, DHS considers adjusting certain fees based on value judgments and public policy reasons consistent with its statutory authority, including sections 286(m) and 344 of the INA, 8 U.S.C. 1356(m) and 1455, and statutory fee exemptions. 47 For example, statutory exemptions for military applicants filing Form N-400 are factored into the fee-setting process to comply with legal requirements. 47 DHS may adjust fees and fee methodologies, including based on policy preferences and value judgments, so long as it acts within its statutory authority and provides a reasoned explanation of the adjustment. See, e.g., FCC v. Fox Television Stations, Inc., 556 U.S. 502, 513-16 (2009) (“the agency may change policy if it acknowledges the change, offers a rational explanation, and considers any serious reliance interests); Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (“the agency must examine relevant data and articulate a satisfactory explanation showing a rational connection between the facts found and the choice made”) (internal quotations omitted). E. Beneficiary-Pays Principle The U.S. Government Accountability Office (GAO), an independent, nonpartisan agency that works for Congress, describes the equity of Federal user fees as a balancing act between two principles: beneficiary-pays and ability-to-pay. 48 Under the beneficiary-pays principle, the beneficiaries of a service pay the cost of providing that service. 49 Under the ability-to-pay principle, those who are more capable of bearing the burden of fees pay more for the service than those with less ability to pay. 50 Fee exemptions, fee waivers, and reduced fees for low-income households are based on the ability-to-pay principle. In its 2020 Fee Rule, DHS chose to emphasize the beneficiary-pays principle. See 84 FR 62280, 62298-62299 (Nov. 14, 2019) (2019 Proposed Fee Rule); see also 85 FR 46788 (Aug. 3, 2020). 51 In its 2024 Fee Rule, DHS chose to reverse its approach and shift more toward the ability-to-pay principle. See 88 FR 402, 424-426; see also 89 FR 6194, 6206, 6240-6243. In this rulemaking, DHS proposes to shift toward the beneficiary-pays principle in setting the fees for Form N-400 and Form N-336 because DHS believes it is not only consistent with Congressional intent, but promotes fairness, and is better suited to achieving the President's policy goals regarding naturalization. In addition, the value of naturalization does not justify shifting the cost burden onto other individuals and firms who pay USCIS fees. For full discussion, see section IV.A. 48 See U.S. Gov't Accountability Office (GAO), GAO-08-386SP, “Federal User Fees: A Design Guide” (May 29, 2008), https://www.gao.gov/products/gao-08-386sp; see also 84 FR 62280, 62298. 49 See GAO, GAO-08-386SP, “Federal User Fees: A Design Guide,” pp. 7-12 (May 29, 2008), https://www.gao.gov/products/gao-08-386sp. 50 See GAO, GAO-08-386SP, “Federal User Fees: A Design Guide,” p. 6 (May 29, 2008), https://www.gao.gov/products/gao-08-386sp. 51 The 2019 Proposed and the 2020 Final Fee Rule would have ended the availability of fee waivers for Form N-336, and limited fee waiver availability for Form N-400 to aliens covered by the TVPRA, Special Immigrant Juveniles (SIJs), and Afghan or Iraqi Special Immigrant Visa (SIV) beneficiaries. See 85 FR 46788. Although the rule was codified in the CFR, the rule was enjoined by courts before it could take effect. See Immigrant Legal Res. Ctr. v. Wolf, 491 F. Supp. 3d 520 (N.D. Cal. 2020) (“ ILRC ”); see also Nw. Immigrant Rts. Project v. U.S. Citizenship & Immigr. Servs., 496 F. Supp. 3d 31 (D.D.C. 2020) (“ NWIRP ”). The DHS 2024 Fee Rule published on January 4, 2024, and replaced the enjoined regulation. Congress has indicated that the beneficiary-pays principle is appropriate in setting fees for services provided by U.S. government agencies. See 31 U.S.C. 9701(a) (“It is the sense of Congress that each service or thing of value provided by an agency . . . to a person . . . is to be self-sustaining to the extent possible.”). 52 The GAO has found that the beneficiary-pays principle helps promote equity by assigning costs to those who both use and benefit from services. 53 The GAO has also noted that the beneficiary-pays principle promotes economic efficiency by ensuring that resources are allocated to the most highly valued user, and that setting a fee too low can induce overuse of agency resources and services. 54 In past USCIS fee rules, DHS has acknowledged that the ability-to-pay principle necessarily requires DHS to shift costs and charge other benefit requestors higher fees so that total fee collections cover total program costs. See 88 FR 402, 426. DHS notes that the proposed changes in this rule would not impact the statutorily mandated fee exemptions for Form N-400 and Form N-336 related to military applicants. See INA secs. 328(b)(4) and 329(b)(4), 8 U.S.C. 1439(b)(4) and 1440(b)(4). 52 For purposes of setting fees under subchapter III of title 8, sec. 344, 8 U.S.C. 1455 directs DHS specifically to consider the principles of section 9701 of title 31, in addition to principles governing fee determinations pursuant to section 286(m) of the INA, 8 U.S.C. 1356(m). 53 GAO, GAO-08-386SP, “Federal User Fees: A Design Guide” (May 29, 2008), p. 8, https://www.gao.gov/products/gao-08-386sp. 54 See GAO, GAO-08-386SP, “Federal User Fees: A Design Guide” (May 29, 2008), https://www.gao.gov/products/gao-08-386sp; GAO, GAO-10-560T, “Federal User Fees,” Testimony Before the Subcommittee on Immigration, Citizenship, Refugees, Border Security, and Int'l Law, Comm. on the Judiciary, U.S. House of Representatives, Statement of Susan J. Irving (Mar. 23, 2010), https://www.gao.gov/assets/gao-10-560t.pdf. F. Background on Naturalization U.S. citizenship confers rights, privileges, and responsibilities that are vital to the security and safety of the United States, a common American identity, and the welfare of the American people. DHS views naturalization as the most meaningful immigration benefit the United States can bestow on an alien. Under sections 312 and 316 of the INA, 8 U.S.C. 1423 and 1427, and implementing regulations at 8 CFR parts 312 and 316, an alien seeking to become a U.S. citizen must generally: • Be at least 18 years of age; • Be lawfully admitted as a permanent resident of the United States; • Have resided continuously within the United States for a period of at least five years after having been lawfully admitted for permanent residence; • Have been physically present in the United States for at least 30 months of the five years preceding the date of filing the application; • Have lived within the state or USCIS district with jurisdiction over the alien's place of residence for at least 3 months prior to the date of filing, or date of the examination if filing early; 55 55 See INA sec. 334(a), 8 U.S.C. 1445(a). • Have resided continuously within the United States from the date of application for naturalization up to the time of admission to citizenship; • For all relevant time periods mentioned, have been and continue to be a person of GMC, attached to the principles of the Constitution of the United States, and favorably disposed toward the good order and happiness of the United States; • Demonstrate an understanding of the English language, including an ability to read, write, and speak words in ordinary usage in the English language; and • Demonstrate a knowledge and understanding of the fundamentals of the history, and of the principles and form of government of the United States. Congress has enacted additional statutory provisions regarding naturalization requirements for spouses of U.S. citizens, certain employees of U.S. nonprofits working abroad, and current and former armed forces service members and their families. See INA secs. 319, 328, and 329, 8 U.S.C. 1430, 1439, and 1440. The vast majority of aliens apply for naturalization by filing Form N-400 with USCIS. 56 If USCIS denies an alien's application for naturalization, the alien may file Form N-336 within 30 days of receipt of the denial to seek a hearing on the denial of the naturalization application before a USCIS officer. 57 56 See USCIS, Form N-400, “Application for Naturalization,” https://www.uscis.gov/n-400 (Jan. 20, 2025 ed.). In addition, the child of a U.S. citizen living abroad who does not acquire citizenship automatically under INA sec. 320, 8 U.S.C. 1431, may file Form N-600K, “Application for Citizenship and Issuance of Certificate Under Section 322.” See INA sec. 322, 8 U.S.C. 1433; USCIS, Form N-600K, “Application for Citizenship and Issuance of Certificate Under Section 322,” https://www.uscis.gov/n-600k (Jan. 20, 2025 ed.). 57 See INA sec. 336, 8 U.S.C. 1447; 8 CFR 336.2(a); USCIS, Form N-336, “Request for a Hearing on a Decision in Naturalization Proceedings Under Section 336,” https://www.uscis.gov/n-336 (Apr. 1, 2024 ed.). Aliens seeking naturalization bear the burden of establishing by a preponderance of the evidence that they meet all the requirements for naturalization, including the GMC requirement. See 8 CFR 316.2(b), 316.10(a)(1). In accordance with section 101(f) of the Act, 8 U.S.C. 1101(f), USCIS evaluates claims of GMC on a case-by-case basis taking into account the elements listed at 8 CFR 316.10, and the standards of the average citizen in the community of residence. 8 CFR 316.10(a)(2). Many factors can affect a GMC determination, see 8 CFR 316.10(b), including false claims to U.S. citizenship. 58 False claims to U.S. citizenship are serious violations of immigration law and can bar an alien from naturalization. See sections 101(f), and 316(a) of the Act, 8 U.S.C. 1101(f) and 1427(a). Individuals who falsely represent themselves as U.S. citizens, whether for voting, employment, or any other purpose, are generally ineligible to obtain LPR status, see section INA 212(a)(6)(C)(ii) of the Act, 8 U.S.C. 1182(a)(6)(C)(ii), which is generally needed to naturalize as a U.S. citizen. See section 316(a) of the Act, 8 U.S.C. 1427(a). Such actions may lead to removal proceedings and other severe immigration consequences. See sections 237(a)(3)(D), (6) of the Act, 8 U.S.C. 1227(a)(3)(D), (6). Additionally, an alien may be subject to federal criminal consequences, including a fine, imprisonment, or both. See 18 U.S.C. 611, 1015(e), and 1015(f). 58 See INA sec. 101(f), 8 U.S.C. 1101(f); USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part F, Good Moral Character, Chp. 5, Conditional Bars for Acts in Statutory Period, Sec. M, False Claim to U.S. Citizenship, Unlawful Voter Registration, and Unlawful Voting, https://www.uscis.gov/policy-manual/volume-12-part-f-chapter-5 (last updated Dec. 22, 2025). For a general overview of the GMC requirement for naturalization, see USCIS Policy Manual,” Vol. 12, Citizenship and Naturalization, Part F, Good Moral Character, https://www.uscis.gov/policy-manual/volume-12-part-f (last updated Dec. 22, 2025). G. Background on Fee Waivers USCIS' authority to waive its filing fees comes from section 286(m) of the INA, 8 U.S.C. 1356(m), which states that “fees for providing adjudication and naturalization services may be set at a level that will ensure recovery of the full costs of providing all such services, including the costs of similar services provided without charge to asylum applicants or other immigrants.” The Trafficking Victims Protection Reauthorization Act of 2008 (TVPRA) requires that USCIS permit certain categories of applicants to apply for fee waivers through final adjudication of adjustment of status. 59 However, neither statute requires USCIS to permit aliens to request fee waivers for Form N-400 or Form N-336. The TVPRA fee waiver requirements only apply “through final adjudication of the adjustment of status,” INA sec. 245(l)(7), 8 U.S.C. 1255(l)(7), so the Act does not specifically require fee waivers for naturalization. 59 These include Violence Against Women Act (VAWA) self-petitioners; T and U nonimmigrants; spouses of A, E-3, G, or H nonimmigrants who were battered or subject to extreme cruelty; applicants for VAWA cancellation of removal; and applicants for or aliens who possess temporary protected status (TPS). See INA sec. 245(l)(7), 8 U.S.C. 1255(l)(7). In general, only forms listed at 8 CFR 106.3(a)(3) are eligible for fee waivers, and DHS designates these forms through regulation. 60 An alien requesting a fee waiver must submit Form I-912, Request for Fee Waiver, or a written request for a fee waiver. See 8 CFR 106.3(a)(2); 89 FR 6194, 6233. Currently, to establish eligibility for a fee waiver, an alien must demonstrate that he or she is unable to pay the fee through one of three criteria: (1) receipt of a means-tested benefit, (2) household income at or below 150 percent of the FPG, or (3) extreme financial hardship. See 8 CFR 106.3(a)(1). 60 The USCIS Director may authorize additional fee waivers pursuant to 8 CFR 106.3(c). H. Recent History of Form N-400 and Form N-336 Fees 1. General Fees The most recent USCIS Fee Rules, including those that took effect in 2010, 2016, and 2024, have emphasized keeping naturalization fees at levels below cost. See 75 FR 33446, 33461-33462 (June 11, 2010) (2010 Proposed Fee Rule); 81 FR 26904, 26915-26916 (May 4, 2016) (2016 Proposed Fee Rule); 88 FR 402, 486-487 (Jan. 4, 2023) (2023 Proposed Fee Rule). DHS has justified these low fees due to the: (1) unique nature of naturalization to the alien; (2) significant public benefit to the United States of newly naturalized citizens; and (3) United States' tradition of welcoming new citizens. See 75 FR 33446, 33461; 81 FR 26904, 26915-26916; 88 FR 402, 487 (citing 2010 Proposed Fee Rule and 2016 Proposed Fee Rule). DHS has also acknowledged public comments stating that cost can be a prohibitive barrier for naturalization applicants. See 88 FR 402, 487. Lower naturalization fees have also been consistent with prior administrations' efforts to promote citizenship and integration. See 75 FR 33446, 33461; 81 FR 26904, 26916; 86 FR 8277, 8277; 88 FR 402, 487. Nevertheless, in prior fee rules, DHS acknowledged that limiting naturalization fees leads to the “subsidization of naturalization by other fee-paying applicants,” who must pay higher fees so that USCIS can achieve full cost recovery. See 75 FR 33446, 33461; 88 FR 402, 487. Table III.1 lays out the current differences in the 2024 Fee Rule's ABC model output costs for the two forms, compared with the current fees. EP23JN26.001 2. Form N-400 Reduced Fee In its 2016 Fee Rule, DHS created a reduced fee for Form N-400 for low-income aliens who do not qualify for a fee waiver. Originally, to qualify for the reduced fee, the alien's household income had to fall between 150-200 percent of the FPG. See 81 FR 73292, 73331 (Oct. 24, 2016) (2016 Fee Rule); 8 CFR 103.7(b)(1)(i)( 1 ) (2017). DHS explained that the reduced fee was designed “to limit potential economic disincentives some eligible applicants may face when deciding whether or not to apply for naturalization,” and the reduced fee supported its priorities of promoting citizenship and integration. See 81 FR 26904, 26916. As with lower fees for naturalization in general, DHS acknowledged that “other fee payers would be required to bear the cost of the reduced fee,” but asserted that “the importance of naturalization justifies this slight shift of burden.” Id. In the 2023 Proposed Fee Rule, DHS proposed to maintain the same income requirements for the reduced fee Form N-400 in its proposed fee schedule. See 88 FR 402, 487. However, DHS's 2024 Fee Rule significantly expanded eligibility for the reduced fee by raising the household income ceiling from the proposed 200 percent to 400 percent of the FPG. See 8 CFR 106.2(b)(3)(ii). In the 2024 Fee Rule, DHS explained that it was expanding the income requirements due to: public comments and additional stakeholder feedback; the financial gains immigrants obtain with naturalization; and the benefits that the United States obtains from new naturalized citizens (including civic involvement and tax revenues). See 89 FR 6194, 6236; id. at 6301. DHS further asserted that this change would provide additional relief to longtime residents who struggle to pay naturalization fees without requiring further fee increases for other forms to offset the cost. See 89 FR 6194, 6236. As shown in Table V.4, receipts of reduced fee Form N-400s were infrequent prior to the effective date of the 2024 Fee Rule. For FY 2019-23, the 5-year annual average of reduced fees constituted only 0.3 percent of total Form N-400 receipts. 61 While receipts of the reduced fee Form N-400 remain a small portion of total Form N-400 filings, reduced fee filings increased substantially after the 2024 Fee Rule took effect. During the 1-year period after the fee rule's effective date (April 2024-March 2025), reduced fee Form N-400 receipts increased to 3.2 percent of total Form N-400 receipts during that period. 62 61 FY 2019-2023 5-Year Average of Reduced Fee N-400s = 2,878. See Table V.4 in this preamble. FY 2019-2023 5-Year Average of Forms N-400 = 845,986. See Table V.3 in this preamble. 2,878 / 845,986 = 0.003 or 0.3 percent. 62 April 2024-March 2025 Total Reduced Fees = 32,344. See Table V.4 in this preamble. April 2024-March 2025 Total N-400 receipts = 1,011,745. See Table V.3 in this preamble. 32,344 / 1,011,745 = 0.032 or 3.2 percent. Currently, to qualify for a reduced fee Form N-400, an alien must complete Part 10 of Form N-400 and submit a copy of each household member's most recent Federal tax return. 63 Form N-400 provides alternate methods of substantiating income for household members who do not file Federal tax returns, or whose tax returns do not properly reflect their income. 64 Currently, a reduced fee Form N-400 can be filed only through paper submission. 63 See USCIS, Form N-400, “Instructions for Application for Naturalization,” pp. 25-26, https://www.uscis.gov/n-400 (Jan. 20, 2025 ed.). 64 See USCIS, Form N-400, “Application for Naturalization, and Instructions,” pp. 25-26, https://www.uscis.gov/n-400 (Jan. 20, 2025 ed.). EP23JN26.002 3. Fee Waivers for Form N-400 and Form N-336 Historically, forms related to citizenship and naturalization (including Form N-400 and Form N-336) have been eligible for fee waivers. See, e.g., 8 CFR 103.7(c) (1997). In its most recent comprehensive fee rule, DHS maintained the availability of fee waivers for Form N-400 and Form N-336. 8 CFR 106.3(a)(3)(iii)(H) and (I). Table III.3 below shows the annual cost/revenue gap resulting from fee waivers for Form N-400 and Form N-336, in comparison to the current general fees and the 2024 Fee Rule ABC model outputs for both forms. EP23JN26.003 I. Review of Form N-400 and Form N-336 Fees and Calculation of Proposed Fees DHS and USCIS use the biennial fee review process to capture any changes in operating costs and non-premium form fees across the USCIS enterprise. When conducting a fee review to determine whether current immigration and naturalization benefit fees will generate sufficient revenue to fund the anticipated operating costs associated with administering the nation's legal immigration system, USCIS usually assesses its recent operating environment to determine the appropriate method to assign costs to immigration benefit requests. For this proposed rule, USCIS is leveraging the FY 2026/2027 IEFA Fee Review (completed November 24, 2025) to propose updated fees for Form N-400 and Form N-336 that better reflect the agency's latest cost projections. USCIS has reviewed recent Form N-400 and Form N-336 revenue collections of fee-paying receipts and compared them to their estimated costs based on the ABC model output unit costs from the 2024 Fee Rule. The results were localized average shortfalls of −$336.6 million and −$1.6 million annually, respectively. In the 2024 Fee Rule, DHS decided to limit the fee increases for these forms to 19 percent for paper and 11 percent for online filings, while continuing to hold the fees below their estimated cost. 89 FR 6194, 6203-6204 (Table 1). EP23JN26.004 Based on these observed revenue shortfalls and the likelihood that the costs for Form N-400 and Form N-336 will continue to grow as explained in Section IV.F of this proposed rule, USCIS expects the cost/revenue gap to continue widening if not addressed soon. To calculate the proposed fees for Form N-400 and Form N-336, DHS relied on projected volumes estimated by the USCIS Volume Projection Committee (VPC), the projected cost data from its FY 2026/2027 biennial review, updated completion rates, and the results from the ABC model. 1. Volume USCIS generally uses two types of volume data to conduct fee reviews: workload and fee-paying volume. Workload volume is a projection of the total number of immigration benefit requests that USCIS would receive in a fiscal year. Fee-paying volume, on the other hand, is a projection of the number of benefit requestors that would pay a fee when filing requests for immigration benefits. The workload volume forecasts are agreed upon by USCIS' VPC. The mission of the VPC is to facilitate workload and fee projection, data stakeholder collaboration, communication, and coordination of critical business decisions about projected workload. All relevant USCIS directorates and program offices are represented in the VPC. This intra-agency group provides a forum for making enterprise-wide decisions about projected workload supported by input from knowledgeable subject matter experts from within USCIS, and information provided by other governmental agencies. At VPC meetings, the committee members deliberate on the provided workload forecast, consider alternatives and recent events that may not yet be reflected in the projections, and agree to a workload forecast by group consensus. The scope of authority of the VPC includes but is not limited to: • Assessing and documenting current USCIS workload projection methodologies; • Benchmarking and documenting workload projection methodologies, assumptions, or projection methodologies applied to similar entities in use by other government agencies and the private sector; • Comparing VPC projections versus actual figures to determine what factors may account for material variances and to better refine its forecasting approach; • Vetting each identified projection methodology through legacy USCIS workload data to determine its efficacy for use in developing workload projections up to 7 years in the future; and • Initiating and maintaining biannual meetings to update workload forecasts. The VPC estimates USCIS annual workload volumes using historical and recent volume trends, statistical forecasts, and subject-matter expertise from various USCIS directorates and program offices, including USCIS service centers, the National Benefits Center, and regional, district, and field offices. Workload volume is a key element used to determine the USCIS resources needed to process immigration benefit requests, such as Form N-400 and Form N-336. Workload volume is the primary cost driver for assigning activity costs to immigration benefit requests. Table III.5 shows the projected average annual volumes for Form N-400 and Form N-336: EP23JN26.005 USCIS generally projects fee-paying volumes by applying a historical and form-specific fee-paying rate to the projected volumes. In some cases, USCIS may modify the projected fee-paying rate to address certain policy changes that could affect the number of fee-paying receipts in the future. As previously stated, USCIS is proposing to eliminate all fee waivers for Form N-400 and Form N-336 but keeping the fee exemptions for military eligible under section 328 or 329 of the INA, 8 U.S.C. 1439, 1440, applicants in this rule. Thus, the fee-paying volume for these forms is now expected to be closer to a 100-percent rate. Fee-paying receipts under the current assumptions from the 2024 Fee Rule are shown in Table III.7 in the Revenue Forecast section. 2. Cost Projections DHS used updated cost projections for the FY 2026/2027 biennial period for this rule. In developing this biennial cost projection, all IEFA non-premium costs were considered, accounting for payroll and non-payroll for on-board and new staff, inflation, resource requirements or adjustments, and the removal of costs associated with temporary programs. USCIS started with its general FY 2025 Operating Plan, which was slightly adjusted for some Return to Workplace costs estimated for the remainder of the fiscal year. USCIS then made the following adjustments in this review: • Added staffing based on the FY 2026 and FY 2027 Staffing Allocation Model (SAM) enhancements and a non-SAM enhancement request for FDNS, for a total of 6,045 new positions across most USCIS offices by the end of FY 2027. The SAM enhancements incorporate the effect of recent Executive Orders, as well as the most recent agency completion rate estimates. The FDNS non-SAM enhancement of 167 positions in FY 2025 was approved to start ramping up hiring in response to Executive Orders 14157 and 14161, 65 with the overall goal to enhance USCIS' vetting and screening capabilities and an average cost of $35.4 million per year. The FDNS SAM includes 574 positions with an average cost of $93.8 million per year over the biennial period to continue the implementation of those Executive Orders; 65 90 FR 8439 (Jan. 29, 2025); 90 FR 8451 (Jan. 30, 2025). • Accounted for pay inflation and promotions/within-grade increases, which includes annual Federal employee pay and cost of living adjustments. The assumed inflation rate was 3 percent for FY 2026 and FY 2027; and • Considered net additional costs, such as the costs of additional budget items. For example, USCIS added the cost of fully taking over lockbox operations during the biennial period ($231.1 million), the building of the new National Records Center ($114.7 million), and the new Voter Verification System ($75.3 million). Table III.6 is a summary from the FY 2025 IEFA non-premium annual operating plan to the FY 2026/2027 annual average cost projection. The FY 2026/2027 annual average cost projection is estimated to be $6,659.1 million. EP23JN26.006 3. Revenue Forecast As previously mentioned, USCIS uses the final volume projections from the VPC to predict future revenue collections for all fee-paying immigration benefit requests. Then, USCIS applies the forecast fee-paying rate to calculate fee-paying receipts, which are then multiplied by the current fees to arrive at the final revenue forecast by form. USCIS is leveraging the average of its final FY 2026 and preliminary FY 2027 Revenue Forecasts for this Form N-400 and Form N-336 fee review. The forecast uses a fee-paying rate of 77 percent for Form N-400, and a 100- percent rate for the Form N-400 Reduced Fee, which reflects the effect of the 2024 Fee Rule, as well as current fee waiver and fee exemption policies. Form N-336's fee-paying rate is 80 percent using the same assumptions. Table III.7 has the resulting fee-paying receipts after applying those fee-paying rates to the VPC's volumes 66 for Form N-400 and Form N-336 as well as the FY 2026/2027 biennial average revenue projections. The revenue forecast for Form N-400 totals $471.9 million and $2.2 million for Form N-336. 66 The VPC does not forecast volumes by filing method (paper or online), nor for the Form N-400 Reduced Fee. USCIS applies an estimated ratio based on historical receipts to split online and paper volumes and applies a ratio of Form N-400 Reduced Fee's fee-paying receipts to total Form N-400 fee-paying receipts to calculate the N-400 Reduced Fee volume. EP23JN26.007 4. Results of Form N-400 and Form N-336 Fee Review USCIS determined that, at current fee levels, projected costs for Form N-400 and Form N-336 workloads in this fee review far exceed projected revenue. After resource costs are identified, the ABC model distributes them to USCIS' primary processing activities. See the supporting documentation in the docket of this rulemaking for more information on the ABC model, activities, and results described in this section. Next, the ABC model distributes activity costs to immigration benefit requests. Each total cost result is based on the resources, activities, and various drivers that contribute to the estimated cost of its completion. The ABC model estimates total cost before calculating unit costs. DHS determined the FY 2026/2027 ABC model cost estimates for Form N-400 and Form N-336, which include the cost of military filings under section 328 or 329 of the INA, 8 U.S.C. 1439, 1440. DHS expects the overall cost of military naturalizations to exceed DOW's annual reimbursement of $7.5 million for the FY 2026/2027 biennial period. See 10 U.S.C. 1790. Therefore, DHS is accounting for the full cost of all Form N-400 receipts, including military naturalizations, but reducing the total Form N-400's ABC model output cost by $7.5 million to account for the annual reimbursement. By doing this, non-military Form N-400 applicants would cover the additional cost not reimbursed for current and former military applications qualified under section 328 or 329 of the INA, 8 U.S.C. 1439, 1440. Similarly, DHS would continue to grant a fee exemption for current and former military applicants for Form N-336. The ABC model output cost for Form N-336 accounts for the full cost of all Form N-336 receipts. Apart from these cost reallocations, DHS did not reallocate any other costs to the proposed fees for Form N-400 and Form N-336 from other non-fee paying USCIS workloads or from forms with fees held below cost at this time. See 89 FR 6194, 6227-6232 (Table 5C). To focus the ABC model and fee review results on the Form N-400 and Form N-336 workloads specifically, DHS developed Table III.8 of this preamble. The table compares the new total ABC model's projected costs for each form to their respective revenue forecasts, which are based on current IEFA fees and fee waiver policies as previously mentioned. The total FY 2026/2027 biennial average ABC Model output cost for Form N-400 is $1,107.9 million and $5.1 million for Form N-336. When comparing those costs to the current FY 2026/2027 average revenue projections, the result is a projected shortfall of −$636.0 million or -135 percent for Form N-400 and −$2.8 million or -126 percent for Form N-336 under the current fee structure. EP23JN26.008 IV. Discussion of Proposed Rule With this rulemaking, DHS proposes three regulatory changes: (1) Adjust the fees for Form N-400 and Form N-336; 67 67 See proposed 8 CFR 106.2(b)(2) and (3). Form N-400 and Form N-336 will remain fee exempt ($0) for members of the U.S. armed forces seeking to naturalize under INA sec. 328 or 329, 8 U.S.C. 1339 or 1440. (2) Remove the option of requesting a reduced fee for aliens who seek to file a Form N-400; 68 and 68 See proposed 8 CFR 106.2(b)(3). (3) Remove the availability of fee waivers for both Form N-400 and Form N-336. 69 69 See proposed 8 CFR 106.3(a)(3)(i). A. Full Cost Recovery for Form N-400 and Form N-336 Fees DHS proposes to increase the general paper filing fee for Form N-400 from $760 to $1,330, a $570 or 75-percent increase. 70 DHS also proposes to increase the general paper filing fee for Form N-336 from $830 to $1,475, a $645 or 77.7-percent increase. See proposed 8 CFR 106.2(b)(2) and (3). DHS is not proposing to change the current $50 discount for filing Form N-400 and Form N-336 online. 71 The online filing fee for Form N-400 would increase from $710 to 1,280, a $570 or 80-percent increase. The online filing fee for Form N-336 would increase from $780 to $1,425, a $645 or 83-percent increase. Consistent with the beneficiary-pays principle, this proposed rule would set the fees for Form N-400 and Form N-336 at levels that recover their full costs, including the increasing cost of processing both forms since USCIS' FY 2022/23 IEFA Fee Rule. The fee increase for Form N-400 also would cover the difference between DOW's reimbursement for military Form N-400 applications, see 10 U.S.C. 1790, and the projected cost of the military Form N-400 filings, while the fee increase for Form N-336 would cover the projected cost of military N-336 filings. 70 DHS does not propose to modify the fee for Form N-600K, Application for Citizenship and Issuance of Certificate Under Section 322, at this time. Although INA sec. 322, 8 U.S.C. 1433, is also a naturalization statute, the Form N-600K was not priced below the cost of processing the form in the previous fee rule (89 FR 6194 (Jan. 31, 2024)). Compare 8 CFR 106.2(b)(8), with USCIS, DHS, “Immigration Examinations Fee Account, Fee Review Supporting Documentation with Addendum” (Nov. 2023), https://www.regulations.gov/document/USCIS-2021-0010-8176. 71 See 8 CFR 106.1(g). Any changes to the online filing discounts would be reviewed in future rulemaking. EP23JN26.009 Prior fee rules, including the 2024 Fee Rule, see Section III.H, set the fees for Form N-400 and Form N-336 below the ABC model output costs for both forms for policy reasons. 72 Lower fees for Form N-400 and Form N-336 deviate from the general principle that each agency service should be self-sustaining, see 31 U.S.C. 9701(a), and they require USCIS to raise fees for other benefit requests to make up the difference, as acknowledged in prior rulemakings. See 84 FR 62280, 62316; 88 FR 402, 487; see also Section III.H, Table III.1. Here, DHS proposes to align the fees for Form N-400 and Form N-336 with the relative burden on USCIS of processing them and recover the costs directly from the adjudications that cause those costs to be incurred. The fees proposed for Form N-400 and Form N-336 in this rule would further ensure full cost recovery as authorized by law and may limit increases to other USCIS forms in future, comprehensive, fee rules. 72 The 2010 Fee Rule established a fee of $595 for Form N-400 but would have had to raise the fee to $655 to recover the full cost. See 75 FR 33446, 33462-33463 (June 11, 2010). The 2016 Fee Rule established a fee of $640 for Form N-400, but would have had to charge, together with the biometric services fee, $946 to cover the full cost. See 81 FR 73292, 73307 (Oct. 24, 2016) (2016 Fee Rule). In the 2024 Fee Rule, the fee was $760, although the full costs assessed was $1,135 based on paper filings. Compare 8 CFR 106.2(b)(3), with USCIS, DHS, “Immigration Examinations Fee Account, Fee Review Supporting Documentation with Addendum” (Nov. 2023), https://www.regulations.gov/document/USCIS-2021-0010-8176. The fees proposed in this rule are consistent with DHS's statutory authorities in section 286(m) and 344 of the INA, 8 U.S.C. 1356(m) and 1455, and longstanding guidance of OMB Circular A-25, which directs agencies to recover their full costs. In past rules, DHS maintained lower fees for Form N-400 and Form N-336 and provided for fee waivers using its broad discretionary authority to set and adjust fees for the services that USCIS provides. See INA sec. 286(m) and 344, 8 U.S.C. 1356(m) and 1455. 73 Similarly, while section 344 of the INA, 8 U.S.C. 1455, requires the Secretary to charge a fee and requires DHS to deposit the fee in accordance with section 286(m) of the INA, 8 U.S.C. 1356(m), it specifies that the prescribed fee should be set in accordance with the principles outlined in 31 U.S.C. 9701, including that they are “subject to policies prescribed by the President” and that each charge shall be “fair; and based on—the costs to the Government; the value of the service . . . ; public policy or interest served; and other relevant facts.” See 31 U.S.C. 9701. 74 Furthermore, Congress, in section 103 of the INA, 8 U.S.C. 1103, delegated to DHS general, broad authority to administer and enforce immigration laws in title 8 of the United States Code, which includes section 286(m) of the INA, 8 U.S.C. 1356(m). Thus, DHS believes the proposed fee adjustments are permissible by statute. 73 “[F]ees for providing adjudication and naturalization services may be set at a level that will ensure recovery of the full costs of providing all such services, including the costs of similar services provided without charge to asylum applicants or other immigrants. Such fees may also be set at a level that will recover any additional costs associated with the administration of the fees collected.” INA sec. 286(m), 8 U.S.C. 1356(m) (emphasis added). “In a case involving an agency, of course, the statute's meaning may well be that the agency is authorized to exercise a degree of discretion. For example, some statutes `expressly delegate' to an agency the authority to give meaning to a particular statutory term. Others empower an agency to prescribe rules to `fill up the details' of a statutory scheme, or to regulate subject to the limits imposed by a term or phrase that `leaves agencies with flexibility,' such as `appropriate' or `reasonable.' ” Loper Bright Enterprises v. Raimondo, 144 S. Ct. 2244, 2263 (2024) (internal citations omitted); see also Paz v. Mayorkas, 767 F. Supp. 3d 368, 378 (E.D. Tex. 2025) (“§ 1356(m) uses the word `may' twice, and this word is understood to have a discretionary import.”) (citing to Kucana v. Holder, 558 U.S.C. 233 (2010)). 74 The Independent Offices Appropriations Act (IOAA) codified at 31 U.S.C. 9701, grants Federal agencies authority to assess user fees. The fees collected under the IOAA are generally deposited in the general fund of the U.S. Treasury and are not directly available to the agency; however, INA sec. 344, 8 U.S.C. 1455, requires DHS to deposit the fees in the IEFA, which is available for use by USCIS until expended. DHS proposes new fees for Form N-400 and Form N-336 that are set in accordance with the beneficiary-pays principle because, as explained in this rule, DHS believes the beneficiary-pays principle is consistent with congressional intent, promotes fairness in comparison to other USCIS filings fees, and is better suited to achieving the President's policy goals regarding naturalization. The beneficiary-pays principle is consistent with section 286(m), which allows for full cost recovery, and 344 of the Act, 8 U.S.C. 1455, which (via reference to 31 U.S.C. 9701) also allows self-sustaining cost recovery and service fee uniformity. 75 While the IOAA instructs DHS to consider other factors when setting fees, including “public policy or interest served,” 31 U.S.C. 9701(b)(2)(C), and the INA allows DHS to charge reduced fees or no fees for certain benefits, such as asylum, 286(m) of the INA, 8 U.S.C. 1356(m), neither statute requires DHS to adhere to the ability-to-pay principle. Thus, DHS believes the beneficiary-pays approach for setting fees is consistent with the IOAA by setting fees at a level needed to be self-sustaining, while also consistent with the INA by basing fees on the authority to recover the costs of operating USCIS. In past fee rulemakings, when DHS set certain fees below costs (such as Form N-400), it provided justification for departing from the beneficiary-pays principle, but when those same rules adhered to the ABC total cost recovery model to set fees, DHS did not explain that by doing so it was using the beneficiary-pays principle. 76 DHS believes that the INA and the IOAA taken together support setting naturalization application fees based on the concept that those who receive the benefit should pay the cost of the services that they require, and those who do not use a service should not be obligated to pay for it. Thus, using the beneficiary-pays principle for setting USCIS fees is permitted by statute. 75 See 31 U.S.C. 9701; see also Public Law 97-258 (HR 6128), sec. 9701(a) (1982). The House Report indicates that the general purpose of the bill was to restate in comprehensive form, without substantive change, certain general and permanent laws related to money and finance. See H.R. Rep. 97-651, 1 (July 21, 1982). 76 Compare 75 FR 33446, 33461-33462 (explaining why “the act of requesting and obtaining U.S. citizenship deserves special consideration,” and therefore the Form N-400 fee should be set a level below the ABC model output), with id. at 33472-33478 (generally not addressing whether to depart from the beneficiary-pays principle for most other forms); compare 88 FR 402, 485-487 (explaining why DHS proposed to limit the fee increase to Form N-400 and shift costs to other fee payers), with id. at 517-530 (generally not addressing whether to depart from the beneficiary-pays principle for most other forms). Having reexamined whether or not DHS should continue charging lower fees for Form N-400 and Form N-336 and shifting those costs to other benefit requests, DHS now believes aliens filing these forms should pay the full cost of adjudication. As stated previously, U.S. citizenship is the most meaningful immigration benefit the United States can bestow on an alien. However, keeping the fees for Form N-400 and Form N-336 below cost requires DHS to shift the costs not covered by those fees to the fees paid for other forms. DHS no longer believes that the importance of naturalization sufficiently justifies funding naturalization from the fees paid for other immigration benefits. Upon reconsideration, DHS now believes that the great value of citizenship is why naturalization application fees should be set at the amount needed for total cost recovery using ABC. In prior rulemakings, DHS explained that the act of requesting and obtaining U.S. citizenship deserves special consideration given the unique nature of this benefit to the individual applicant, the significant public benefit to the Nation, and the Nation's proud tradition of welcoming new citizens. See 75 FR 33446, 33461; 81 FR 26904, 26915-26916; 88 FR 402, 487 (citing 2010 Proposed Fee Rule and 2016 Proposed Fee Rule). DHS stated that keeping the naturalization fee at lower levels would allow more immigrants to fully participate in civic life and would help promote citizenship and immigrant integration. See 88 FR 402, 487. DHS reasoned that setting the Form N-400 fee at an amount less than its estimated costs and shifting those costs to other fee payers was appropriate and rational considering the significant value that the United States obtains from the naturalization of new citizens. Id. Although DHS still believes naturalization is the most meaningful immigration benefit the United States can bestow on an alien, and it provides significant benefits to new U.S. citizens, 77 DHS also believes other benefit requests provide significant benefits to alien applicants and beneficiaries; 78 these aliens should not have to pay higher fees to subsidize naturalization. While newly naturalized citizens may provide benefits to the United States, 79 so do the recipients of other immigration benefits, such as immigrant and nonimmigrant visas. 80 U.S. citizens who file family-based visa petitions benefit directly from their ability to reunite with alien relatives, while employment-based petitioners benefit directly from their new employees. In contrast, the benefits of naturalization, such as increased civic participation or tax revenue ( see 89 FR 6194, 6300) may be less immediate, more uncertain, and more dispersed. Furthermore, while the United States has a history of accepting new citizens, it also has a history of accepting lawful immigrant and nonimmigrant aliens. See generally INA secs. 201 and 214, 8 U.S.C. 1151 and 1184. Some of the forms that are currently subject to fees substantially higher than their ABC model outputs include: 77 See, e.g., Madeleine Sumption & Sarah Flamm, “The Economic Value of Citizenship for Immigrants in the United States,” Migration Policy Institute (Sept. 2012), https://www.migrationpolicy.org/sites/default/files/publications/citizenship-premium.pdf. However, research has noted that some of the apparent economic benefits of naturalization are due to other factors: “naturalized immigrants have higher levels of education, better language skills, and more work experience in the United States.” Id. at 1. 78 See, e.g., Miao Chi & Scott Drewianka, “How much is a green card worth? Evidence from Mexican men who marry women born in the U.S.,” Labour Economics Vol. 31, 103-116 (Dec. 2014), https://www.sciencedirect.com/science/article/abs/pii/S0927537114001328. 79 See, e.g., Holly Straut-Eppsteiner, Cong. Research Serv., R43366, “U.S. Naturalization Policy” (Apr. 15, 2024), https://www.congress.gov/crs-product/R43366?s=1&r=77 (Outcomes for the United States). 80 See, e.g., Sarah Donovan et al., Cong. Research Serv., R47164, “U.S. Employment-Based Immigration Policy” (Nov. 19, 2024), https://www.congress.gov/crs-product/R47164?s=1&r=48 (“Several studies identify positive contributions of foreign-born workers—particularly highly skilled immigrants—to the U.S. economy.”); Julia Gelatt, “Explainer: Immigrants and the U.S. Economy,” Migration Policy Institute (Oct. 2024), https://www.migrationpolicy.org/content/explainer-immigrants-and-us-economy. • Form I-129F, Petition for Alien Fiancé(e), • Form I-130, Petition for Alien Relative, • Form I-131, Application for Travel Documents, Parole Documents, and Arrival/Departure Records, • Form I-140, Immigrant Petition for Alien Workers, • Form I-485, Application to Register Permanent Residence or Adjust Status, • Form I-765, Application for Employment Authorization. 81 81 Compare USCIS, DHS, “Immigration Examinations Fee Account, Fee Review Supporting Documentation with Addendum” (Nov. 2023), https://www.regulations.gov/document/USCIS-2021-0010-8176, with USCIS, Form G-1055, “Fee Schedule,” https://www.uscis.gov/g-1055 (Oct. 28, 2025 ed.). DHS further recognizes that the lower fees for Form N-400 and Form N-336 shift some costs from present naturalization applicants to future naturalization applicants. 82 That is, some of the resulting fee increases are borne by future Form N-400 applicants and their families, which impacts their ability to save for future naturalization fees. As articulated by one public comment on the 2023 Proposed Fee Rule: 82 See Comment Submitted by Cato Institute (Apr. 17, 2023), https://www.regulations.gov/comment/USCIS-2021-0010-7325. [T]he NPRM asserts that the naturalization fee is being set “at an amount less than its estimated costs,” arguing that “shifting those costs to other fee payers was appropriate in order to promote naturalization and immigrant integration.” This stance gets the principle of immigrant integration backward. Given that a green card is a prerequisite to naturalization, and a nonimmigrant visa is often a de facto prerequisite for a green card in many cases, raising fees for these categories prevents immigrant integration. USCIS should prioritize getting immigrants in a position where they are eligible to naturalize if it cares about integration. Other applicants should not have to bear the cost of naturalization when it is more pressing for them to receive green cards or other statuses in the United States. So, while lower naturalization application fees may temporarily support naturalization efforts, due to USCIS' funding structure, there is no evidence that they result in a sustained increase in naturalization rates in comparison to fees that reflect the actual cost of adjudication. As explained further in Section V.A.7 (Price Elasticity), while increasing naturalization fees may temporarily decrease naturalization application rates for some aliens, past fee increases have not led to long-term declines in overall naturalization application rates. See also Supporting and Related Material, N-400 Receipts by Fiscal Year and Effective Dates of New Fee Schedules FY 2006-FY 2025 (through August 30, 2025). 83 As the timeline of USCIS fee schedules shows, increases in fees for Form N-400 have not typically been followed by declines in Form N-400 filings. While USCIS did temporarily see a sharp decline in filings in Q1 of FY 2008 following the 80-percent increase to the Form N-400 fee that took effect on July 30, 2007, DHS believes that short-term, steep decline was the recoil effect from the surge of applications submitted during the leadup to the fee increase, which was announced on February 1, 2007. 84 Furthermore, some of the ensuing drop off was likely due to LPRs' diminishing economic prospects during the Great Recession, which began a few months after the Form N-400 fee increased. 85 Within approximately 2 years after the Form N-400 fee increased, Form N-400 filing rates returned to their historical levels. 83 Available for review and comment in the rulemaking docket at https://www.regulations.gov. 84 See 72 FR 4888, 4908 (Feb. 1, 2007) (Table 12); Manuel Pastor et al., “Nurturing Naturalization: Could Lowering the Fee Help?,” National Partnership for New Americans (Feb. 2013), https://dornsife.usc.edu/eri/wp-content/uploads/sites/41/2023/01/2013_Nurturing_Naturalization_CSII.pdf (hereinafter, Pastor, “Nurturing Naturalization”) (“This all suggests that there was a `sticker shock' effect in which demand tried to race ahead of the planned price increase, then fell.”). 85 See Federal Reserve History, “The Great Recession” (Nov. 22, 2013), https://www.federalreservehistory.org/essays/great-recession-of-200709. In addition because aliens applying for naturalization must possess LPR status (unless applying under a fee-exempt military statute), they already possess the ability to live and work in the United States indefinitely. While naturalization brings additional privileges (for example, the ability to vote in Federal elections and serve on juries), these benefits are not as critical to the immediate wellbeing of aliens as other immigration benefits, such as those bestowing humanitarian or protection-based status. DHS now believes that, because the need to naturalize is generally less immediate in comparison to other benefit requestors who face potential removal due to lack of lawful status ( see INA sec. 237(a)(1)(B), 8 U.S.C. 1227(a)(1)(B)) or lack authorization to seek employment ( see INA sec. 274A, 8 U.S.C. 1324a), below-cost fees are generally less necessary for filing for naturalization. Finally, although DHS proposes to shift away from the ability-to-pay principle in this proposed rule, DHS notes that lower fees for Form N-400 and Form N-336 are not supported by the ability-to-pay principle either. 86 The general eligibility requirements for naturalization under section 316 of the INA, 8 U.S.C. 1427, require aliens to have continuously resided in the United States for 5 years after lawful admission for permanent residence, 87 during which they are authorized to accept employment. See 8 CFR 274a.12(a)(1). Having continuously resided in the United States with employment authorization before applying for naturalization, these naturalization applicants should have more financial stability, on average, than other categories of aliens, most of whom have not lived in the United States or possessed unrestricted employment authorization for as long. 88 Naturalization applicants should generally possess as much or greater ability to pay than the applicants and petitioners who submit other benefit requests, and therefore, lower naturalization fees represent a departure from the ability-to-pay principle ( i.e. those who are more capable of bearing the burden of fees should pay more for the service than those with less ability to pay). 86 See Section III.E. for a discussion of the ability-to-pay principle. 87 Cf. INA sec. 334, 8 U.S.C. 1445 (“[T]he application for naturalization may be filed up to 3 months before the date the applicant would first otherwise meet such continuous residence requirement.”). 88 See, e.g., Josefina F. Morales, “Financial Security and Immigrants' Legal Status: An Analysis of Net Worth in the United States,” Retirement & Disability Research Center (2019), Table 2, https://rdrc.wisc.edu/publications/working-paper/jsit19-04 (comparing wealth indicators of those in “Precarious/Undocumented” status versus those in LPR status); see also Mohamad Moslimani, “Key facts about the wealth of immigrant households during the COVID-19 pandemic,” Pew Research Center (Dec. 4, 2023), https://www.pewresearch.org/short-reads/2023/12/04/key-facts-about-the-wealth-of-immigrant-households-during-the-covid-19-pandemic/ (Finding 3: “The longer an immigrant has been in the U.S., the more wealth their household typically has.”). DHS agrees that naturalization provides a matchless benefit to aliens but does not believe that this justifies underpriced naturalization fees that fail to recover the cost of adjudicating such a valuable benefit. DHS believes that the unique privilege of becoming a U.S. citizen must be safeguarded through proper screening and vetting, see Section III.C., which necessarily increases the overall cost of naturalization. For these reasons, DHS is proposing to adjust the Form N-400 and Form N-336 fees to levels consistent with the cost of processing both forms. See proposed 8 CFR 106.2(b)(2) and (3). B. Remove Form N-400 Reduced Fee In addition to raising the fee for Form N-400, DHS proposes to remove the reduced fee option for those naturalization applicants with household incomes not more than 400 percent of the FPG, which is currently codified at 8 CFR 106.2(b)(3)(ii). See proposed 8 CFR 106.2(b)(3). Currently, qualifying aliens applying for naturalization applicants pay a reduced fee of $380. In support of the proposed change, DHS reasserts the fee calculation and rationale given for setting the fee for Form N-400 at a level that achieves full cost recovery. See Section IV.A earlier in this preamble. Specifically, eliminating the reduced fee for Form N-400 would: • Align the fee for Form N-400 with the cost of adjudicating the form; • Ensure that USCIS has sufficient revenue to cover the cost of Form N-400 as costs of properly screening and vetting and adjudicating such applications increase; and • Align with the beneficiary-pays principle and Congressional intent of section 344 of the INA, 8 U.S.C. 1455, and 31 U.S.C. 9701. For the same reasons discussed earlier in this preamble regarding the existing Form N-400 and Form N-336 fees, DHS believes there is insufficient justification for the Form N-400 reduced fee. While naturalization is a unique benefit, so are other benefit categories and the potential benefits to and from newly naturalized citizens do not justify burdening other benefit requestors with higher fees to subsidize the reduced fee Form N-400. 89 89 Although DHS stated in its 2024 Fee Rule final rule that the broader eligibility requirements for Form N-400 would not require further fee increases to other forms to offset the costs, 89 FR 6194, 6236, this was achieved through revisions to the USCIS budget and transferring costs to premium processing revenue. Id. at 6206-6208. Had DHS left the income ceiling for the reduced fee Form N-400 at its prior level of 200 percent of the FPGs, this would have allowed DHS to further limit the fee increases to other forms. See id. at 6198-6204 (Table 1). Furthermore, DHS notes that the reduced fee for Form N-400 is a stark anomaly in the USCIS Fee Schedule, which would require compelling justification to maintain. While DHS does set prices for some other USCIS benefits below cost and provides fee waivers for other forms, see 8 CFR 106.3(a), it does not provide a reduced fee for any other USCIS benefit when the requestor's household income falls within a specific income range. See 8 CFR 106.2. Maintaining this unique privilege for Form N-400 results in cost reallocations to other benefits. Additionally, the current income ceiling for the reduced fee for Form N-400 (at or below 400 percent of the FPG) is extraordinarily high. Table IV.2 illustrates that difference between the income ceiling for the reduced fee and median household income in the United States. EP23JN26.010 As seen in Table IV.2, aliens who qualify for a reduced Form N-400 fee may have household income above (and in some cases, well above) U.S. median household income. For example, based on the 2025 FPGs, an alien living in the lower 48 States in a four-person household would qualify for a reduced fee if his or her annual household income was at or below $128,600 per year. Aliens in the 200-400 percent FPG range should be less price sensitive than those in the pre-existing 150-200 percent range. If aliens at this income level choose not to apply for naturalization in the absence of a reduced fee, this may not reflect a difficulty in paying the filing fee, but a choice to not file for naturalization. In addition, DHS notes that eliminating the reduced fee for Form N-400 would mitigate the proposed increase to the general fee for Form N-400. By eliminating the cost/revenue gap caused by the reduced fee, DHS reduces the cost reallocations to the general Form N-400 fee that would be proposed. Also, ending the reduced fee would simplify the fee structure for Form N-400, and thereby simplify intake procedures for USCIS. Furthermore, the general Form N-400 fee, and the Form N-400 reduced fee were previously held below cost, which resulted in cost reallocations to other USCIS forms in prior fee rules. 90 So, eliminating the reduced fee and increasing the general Form N-400 fee could potentially enable DHS to limit increases to other USCIS forms in subsequent fee rules. Moreover, as discussed in Section IV.C, the reduced fee for Form N-400 incentivizes ineligible aliens to apply for naturalization, which unnecessarily consumes USCIS resources and forces eligible aliens to wait longer to naturalize. 90 See 88 FR 402, 488 (“Other fee payers are required to bear the cost of the reduced fee[.]”). Reduced fee Form N-400s constitute a small portion of total Form N-400 filings, as discussed in Section III.H.2. Prior to the effective date of the income ceiling increase (from 200 percent to 400 percent), reduced fee Form N-400s were a mere 0.3 percent of total non-military Form N-400 receipts. Even after the drastic increase in the income ceiling, reduced fee Form N-400s only make up 3.2 percent of total non-military Form N-400 receipts. So, while eliminating the reduced fee for Form N-400 might cause certain aliens to delay applying for naturalization, DHS does not believe that this proposed change would affect the vast majority of aliens who wish to pursue naturalization. C. End Fee Waiver Eligibility for Form N-400 and Form N-336 DHS proposes to end fee waiver eligibility for Form N-400 and Form N-336, which is currently codified at 8 CFR 106.3(a)(3)(i)(H) through (I). See proposed 8 CFR 106.3(a)(3)(i). 91 As previously stated, DHS's legal authorities related to the setting of naturalization fees, including section 286(m) of the INA, 8 U.S.C. 1356(m), authorize USCIS to waive the fees for certain benefit request, but do not require it to do so. Although the TVPRA requires USCIS to allow aliens filing certain benefit requests to request fee waivers, this requirement only extends “through final adjudication of the adjustment of status.” See INA sec. 245(l)(7), 8 U.S.C. 1255(l)(7). Thus, the TVPRA's fee waiver requirements do not extend to Form N-400 or Form N-336. 91 DHS does not propose to modify 8 CFR 106.3(c), which authorizes the Director of USCIS to waive or exempt fees that are not otherwise waivable or exempt under the fee schedule regulation at 8 CFR part 106, and does not propose to modify the availability of fee waivers for any other forms as part of this rulemaking. DHS now proposes to eliminate fee waivers for Form N-400 and Form N-336 in order to: • Mitigate the proposed fee increases to Form N-400 and Form N-336 by increasing the percentage of fee-paying filers; • Improve USCIS processing efficiency for Form N-400 and Form N-336 by simplifying intake procedures and reducing adverse incentives for ineligible aliens to file; and • Align with the beneficiary-pays principle and be consistent with section 344 of the INA, 8 U.S.C. 1455, as well as 31 U.S.C. 9701. First, as explained with regard to the reduced fee for Form N-400 in Section IV.B, eliminating fee waivers for Form N-400 and Form N-336 would mitigate the proposed increases to the general fees for both forms. Because DHS seeks to ensure that the fees for Form N-400 and Form N-336 are self-sustaining and recover the full cost of their own adjudication, the costs of maintaining these fee waiver requests would be covered through increased fees for Form N-400 and Form N-336 applicants. DHS estimates that maintaining fee waivers for both these forms while proposing new fees would result in an extra $85-$120 per form, as displayed in Table IV.3, than it would if the proposed change to eliminate fee waivers is implemented. EP23JN26.011 While an additional fee increase of $85-$120 may not be significant to certain households, USCIS recognizes that this may impose further financial burden on other households who are subject to the proposed fees. To limit the proposed fee increases, DHS has proposed to end the availability for fee waivers for these forms. Second, DHS now believes that eliminating fee waivers for Form N-400 and Form N-336 would significantly improve USCIS processing of Form N-400 and Form N-336. As with the reduced fee for Form N-400, ending fee waivers for Form N-400 and Form N-336 would simplify intake procedures for USCIS, and allow USCIS to substantially reduce the resources spent on adjudicating fee waiver requests. Furthermore, DHS now believes that fee waiver eligibility for Form N-400 and Form N-336 (like the Form N-400 reduced fee) creates adverse incentives for aliens to apply for naturalization. In general, DHS believes that free filing or inexpensive fees may encourage aliens who know or suspect that they are ineligible for naturalization to apply anyway on the off chance that they may be approved. 92 As shown in Table IV.4 and Table IV.5, this incentive appears to have a notable effect on the filing of Form N-400 and Form N-336. This may be because a negative decision on an N-form does not typically result in enforcement action against the alien, who is typically an LPR, and because the ability of certain aliens to pass the English and civics test can depend on their “luck of the draw” of test questions. 93 92 See GAO, GAO-08-386SP, “Federal User Fees: A Design Guide” (May 2008), p. 10, https://www.gao.gov/products/gao-08-386sp (“[S]etting the fee too low induces overuse of agency resources and services.”). 93 See 90 FR 45047, 45050 (Sept. 18, 2025) (For its 2025 Naturalization Civics test, USCIS administers 20 questions out of a bank of 128 questions). EP23JN26.012 EP23JN26.013 Tables IV.3 and IV.4 reveal statistically significant differences in denial rates between Form N-400 and Form N-336 applicants who pay the full fee, receive a fee waiver, or receive a reduced fee (Form N-400 only). 94 In FYs 2020-2024, the Form N-400 approval rate was 93 percent for those with no reduced fee or fee waiver, but 90 percent for those with a reduced fee and only 83 percent for those who received a fee waiver. While the failure rate on the English/civics test (INA 312 denial) was 3 percent for those with no reduced fee or fee waiver, the INA 312 denial rate was 6 percent for applicants who received a reduced fee and 12 percent for applicants who received a fee waiver. This indicates that aliens who are unprepared for the English/civics exam but eligible for a fee waiver or reduced fee could be incentivized to apply for naturalization prematurely, rather than waiting to master the exam content. Table IV.5 reveals a similar effect for Form N-336: While the approval rate for most requests was 62 percent, the approval rate is only 52 percent for fee-waived requests. By removing the incentive to file Form N-400 prematurely, ending fee waivers could help reduce the inefficient use of USCIS resources on ineligible naturalization cases and improve USCIS processing of eligible Form N-400 cases. 94 Based on a Z-test of proportion, the differences in denial rate between Form N-400 subgroups and Form N-336 subgroups are statistically significant at a 0.1 percent level. Finally, DHS notes that eliminating fee waivers would be consistent with the beneficiary-pays principle and with section 344 of the INA, 8 U.S.C. 1455, as well as 31 U.S.C. 9701. As discussed further in Section IV.D., Impact of Proposed Changes, DHS acknowledges that elimination of fee waivers for Form N-400 and Form N-336 may prevent certain aliens from applying for naturalization in the short term, but notes that these aliens could apply for naturalization in the future. Eligibility for a fee waiver means that USCIS has determined that the alien currently lacks the ability to pay, see 8 CFR 106.3(a)(1), not that the alien is permanently unable to pay for Form N-400 and Form N-336. 95 For these reasons, DHS believes that the benefits of eliminating fee waivers (which could reduce fee increases for Form N-400 and Form N-336 applicants and improve processing for both forms) outweighs the potential burdens to certain aliens who may currently lack the ability to pay. 95 See USCIS, Form I-912, “Instructions for Request for Waiver,” p. 6, https://www.uscis.gov/i-912 (July 22, 2025 ed.) (requiring that the means-tested benefit is currently being received); id. at 7 (requiring copy of “most recent Federal tax return, if available” or pay statements for the past month); USCIS, DHS, “USCIS Policy Manual,” Vol. 1, Part B, Ch. 4, Fee Waivers and Fee Exemptions, https://www.uscis.gov/policy-manual/volume-1-part-b-chapter-4 (last updated Nov. 3, 2025) (“Extreme financial hardship occurs when a requestor requires substantially all of their current income and liquid assets to meet current ordinary and necessary living expenses.”). D. Impact of the Proposed Changes DHS understands that some studies conclude that higher naturalization fees would prevent some LPRs from applying for naturalization, but does not believe that the level of impact is as great as these studies have attributed to fee increases. 96 Despite DHS's decision to maintain low fees for naturalization and broaden eligibility for the reduced fee Form N-400 in the 2024 Fee Rule, that rule's Regulatory Impact Analysis (RIA) found Form N-400 to be an inelastic good, 97 meaning that the quantity demanded does not change substantially in response to changes in price. In this proposed rule, DHS maintains the position that Form N-400, or the citizenship benefit that it confers, is an inelastic good. See Section V.7. Consistent with this conclusion, DHS notes that one study has acknowledged that increases and subsequent drops in Form N-400 receipts surrounding significant fee increases in 1999 (137-percent fee increase) and 2007 (80-percent increase) 98 partially reflect a front-running of the fee changes by naturalization applicants, 99 and that other factors likely contributed to the rises and declines in naturalization filings surrounding these fee increases. 100 Furthermore, DHS notes that one study found some substitution effect for fee waivers—meaning that some aliens who obtain fee waivers for Form N-400 are able and willing to pay the full naturalization fee anyway. 101 Therefore, studies, including those cited by courts in challenges to past fee rules, do not demonstrate that naturalization is an elastic good, or that the proposed fee changes would result in long-term declines in naturalization application rates. 102 96 See Pastor, “Nurturing Naturalization”; Hainmueller et al., “A randomized controlled design reveals barriers to citizenship for low-income immigrants,” PNAS 115(5), 939-44 (Jan. 30, 2018), https://www.pnas.org/doi/epdf/10.1073/pnas.1714254115 (hereinafter, Hainmueller, “Barriers to Citizenship”); Gonzalez-Barrera et al., “The Path Not Taken: Two-thirds of Legal Mexican Immigrants are not U.S. Citizens,” Pew Research Center (Feb. 4, 2013), https://www.pewresearch.org/race-and-ethnicity/2013/02/04/the-path-not-taken/ (hereinafter, Gonzalez-Barrera, “The Path Not Taken”); Vasil Yasenov et al., “Standardizing the fee-waiver application increased naturalization rates of low-income immigrants,” PNAS 116(34), 16768-16772 (Aug. 6, 2019), https://www.pnas.org/doi/10.1073/pnas.1905904116 (hereinafter, Yasenov, “Standardizing the fee-waiver application”). 97 See USCIS, DHS, “Regulatory Impact Analysis” (Jan. 2024), https://www.regulations.gov/document/USCIS-2021-0010-8179. 98 See Pastor, “Nurturing Naturalization,” at 6. 99 Id. at 9 ( [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A2026-12542. Public record. Not legal advice.