New USCIS Adjustment of Status Policy: What It Means for Your Green Card Application in 2026

On May 21, 2026, USCIS issued Policy Memorandum PM-602-0199, reframing adjustment of status (AOS) as a discretionary act of "administrative grace" rather than a routine pathway to a green card. The accompanying press release on May 22, 2026 went further, with USCIS spokesman Zach Kahler stating that a foreign national “who is in the U.S. temporarily and wants a Green Card must return to their home country to apply, except in extraordinary circumstances.." For the hundreds of thousands of employees and sponsored workers with pending or planned I-485 applications, this policy shift introduces new uncertainty into the green card process. This guide breaks down what the memo actually says, who faces the most risk, and what the practical implications are for employers and employees.

What PM-602-0199 Actually Says (and What It Does Not)

The gap between the USCIS press release and the operative memo is significant, and understanding the difference matters for case strategy.

The press release declared that green card applicants who are in the U.S. temporarily "must return to their home country to apply, except in extraordinary circumstances." This language caused immediate alarm. However, the policy memo itself does not contain the phrase "only in extraordinary circumstances" and does not prohibit AOS filings.

What the memo actually does is direct USCIS officers to treat adjustment of status as an "extraordinary form of relief" and an act of "administrative grace" under INA Section 245(a). It instructs officers to apply heightened discretionary scrutiny when adjudicating I-485 applications, using a totality of the circumstances analysis that weighs both positive and negative factors.

The memo cites established legal precedent, including Matter of Blas, 15 I&N Dec. 626 (BIA 1974; A.G. 1976); Patel v. INS, 738 F.2d 239 (7th Cir. 1984); and Patel v. Garland, 596 U.S. 328 (2022), for the principle that adjustment is a privilege, not an entitlement. In practical terms, this means meeting the technical eligibility requirements for a green card may no longer be sufficient on its own. USCIS officers now have explicit direction to evaluate whether an applicant's circumstances justify the "privilege" of adjusting status inside the United States instead of processing through a U.S. consulate abroad.

Important: The memo does not create new eligibility requirements, does not ban I-485 filings, and does not change any statute or regulation. Adjustment of status remains a legal pathway authorized by Congress. What has changed is how aggressively USCIS officers are directed to use their discretionary authority.

Adverse Factors Officers Will Weigh Against an Application

The memo directs officers to consider several specific negative factors during the discretionary analysis. Understanding these factors is essential for both employees and employers preparing or maintaining an I-485 case.

Factors that may count against an application:

• Violations of U.S. immigration laws or status conditions: Any period of unauthorized employment, overstay, failure to maintain nonimmigrant status, or breach of admission terms. Even brief gaps may now be significant.
• Fraud or false testimony: Past or current fraud, misrepresentation, or false statements made to USCIS or any government agency, including during prior visa applications.
• Conduct inconsistent with the purpose of admission: If the applicant entered on a visa without statutory dual intent (student, tourist, or certain work visas) and then pursued permanent residence, officers may view this as inconsistent with the stated purpose of admission.
• Failure to depart at the end of authorized stay: The memo frames the choice to remain in the U.S. and adjust, rather than departing for consular processing, as a potentially adverse factor in itself.
• Whether admission or parole complied with laws and policies in effect at the time: Officers will look at whether the original entry was consistent with the rules that applied at the time of admission.

The most aggressive element of the memo is its treatment of failure to depart. The memo states that this factor is "highly relevant" to the discretionary analysis, especially when connected to an intent to reside permanently in the United States and when consular processing was available as an alternative (USCIS Policy Memo PM-602-0199).

Critically, the memo also states that "the absence of adverse factors, by itself, does not demonstrate such unusual or outstanding equities." This means that having a clean immigration record may be necessary but not sufficient. Applicants may need to affirmatively demonstrate positive equities.

Positive factors that may strengthen a case include: continuous maintenance of lawful status with no gaps; a long history of tax compliance (3+ years of returns); U.S. citizen spouse or children; strong community ties including volunteer work, charitable involvement, and civic participation; significant professional contributions and achievements; employer reliance on the applicant's specialized skills; and dual-intent visa status (H-1B, L-1).

Risk factors that may increase scrutiny include: any period of unauthorized employment or status gap; entry on a visa without statutory dual intent (F-1, B-1/B-2, TN, J-1, E-3) followed by a green card filing; Day-1 CPT arrangements; prior visa denials or SEVIS terminations; rapid transition from tourist or student status to a permanent residence application; failure to depart after completing the stated purpose of admission; and prior findings of fraud or misrepresentation.

How This Affects Employment-Based Green Card Applicants

Dual-Intent Visa Holders: H-1B and L-1

The memo explicitly acknowledges that filing for adjustment of status is "not inconsistent with simultaneously maintaining nonimmigrant status in a category with dual intent." This means H-1B and L-1 visa holders, along with their H-4 and L-2 dependents, are comparatively better positioned under this framework.

However, dual intent is not a shield against all scrutiny. The memo includes a specific caution in footnote 20 that "maintaining lawful status in a dual intent nonimmigrant category is not sufficient, on its own, to warrant a favorable exercise of discretion" (USCIS Policy Memo PM-602-0199, fn. 20). Dual intent may help an applicant avoid the "failure to depart" adverse factor, but officers will still evaluate the full immigration history, employment record, and overall equities.

Key considerations for H-1B and L-1 employees:

• Maintaining continuous lawful status with no lapses between extensions or transfers
• Keeping thorough records of LCA compliance, pay stubs, and employment authorization
• Documenting positive equities proactively: tax returns, community involvement, family ties
• Reviewing any potential adverse factors with an employer and immigration counsel before the I-485 interview or adjudication

Visa Holders Without Statutory Dual Intent: F-1, B-1/B-2, TN, E-3, J-1

Applicants on visas without statutory dual intent face the highest risk under PM-602-0199. The memo's core logic applies most directly to these visa categories: officers may view the transition from a temporary, single-purpose admission to a permanent residence application as conduct inconsistent with the purpose of entry.

Categories under increased scrutiny:

• F-1 students, particularly those with concerns about immigrant intent at entry, Day-1 CPT, rapid transitions to green card filings, or SEVIS issues. (Note: USCIS's December 20, 2023 Policy Manual update permits F-1 students to be beneficiaries of a labor certification or I-140 petition if present intent to depart upon program completion is maintained.)
• B-1/B-2 visitors who entered on tourist visas and then filed for adjustment
• TN visa holders, who maintain a nonimmigrant (temporary) intent classification under 8 CFR 214.6(b). While TN is not subject to a formal foreign-residence requirement, it is not a dual-intent category, and officers may view a green card filing as inconsistent with the temporary purpose of TN admission.
• O-1 visa holders. The O-1 is not formally a dual-intent classification under USCIS regulations (8 CFR 214.2(o)(13) requires temporary intent). However, the Department of State Foreign Affairs Manual (9 FAM 402.13-5(B)) expressly permits O-1 holders to pursue lawful permanent residence concurrently without that being a basis for visa denial, making O-1 a "quasi-dual-intent" category in practice. O-1 holders' extraordinary ability evidence may also translate into strong positive equities.
• E-3 visa holders and other specialty occupation categories without statutory dual intent

For employees in these categories, the strategic question is whether transitioning to H-1B or L-1 status before filing the I-485 could reduce discretionary risk. This requires careful case-by-case analysis with immigration counsel, because H-1B lottery selection rates remain low and the $100,000 per-petition supplemental fee imposed by Presidential Proclamation No. 10973 (90 Fed. Reg. 46,027, effective September 21, 2025) adds significant cost. That fee applies to new H-1B petitions for beneficiaries outside the U.S. without a valid H-1B visa, or petitions requesting consular notification; it does not apply to extensions, amendments, or change-of-status petitions for beneficiaries already in the U.S. in valid status.

EB-1, EB-2 NIW, EB-2 PERM, and EB-3 Applicants

An approved I-140 petition does not guarantee I-485 approval under the new framework. Officers are now directed to scrutinize every employment-based I-485, regardless of the underlying category.

For EB-2 NIW and EB-1A applicants, the same evidence supporting the petition (national importance, extraordinary achievement, professional contributions, patents, publications) can potentially be repackaged as discretionary equities. If an I-140 was approved based on strong evidence of national impact, that evidence may directly support the argument that the applicant merits the privilege of adjusting status in the United States.

For EB-2 PERM and EB-3 applicants whose cases rely on employer sponsorship and labor certification, the discretionary packet would typically need to be built from additional evidence. Tax compliance, community involvement, and the employer's reliance on the applicant's skills become primary arguments.

Protect your green card application with Alma

Alma's immigration platform gives employers and employees real-time visibility into every I-485 case, with dedicated attorneys who understand how PM-602-0199 changes the adjudication landscape. Alma's team is already building discretionary evidence packets for clients, auditing pending cases for adverse factors, and developing proactive RFE response strategies. Whether there is a pending I-485 or a new filing is being planned, schedule a consultation to assess risk profiles under the new policy.

What This Means for Pending I-485 Applications

Retroactive Application to Cases Already Filed

USCIS officers adjudicating pending I-485 applications after May 21, 2026 may apply the memo’s discretionary framework because discretion is exercised at the time of adjudication. However, the memo does not expressly address pending cases or retroactivity. The memo contains no transition date and no prospective-only carve-out. Because USCIS assesses discretion at the moment of final adjudication, the heightened standard likely reaches every I-485 currently in the queue. However, because the memo does not contain an explicit effective date and is not presented as a formal change in policy, there is an argument that pending cases may still be adjudicated under prior standards. This interpretive question may ultimately be resolved by the courts. Either way, the new discretionary framework introduces meaningful uncertainty for cases filed before May 21, 2026.

Key considerations for those with a pending I-485:

• Withdrawal carries significant consequences. Withdrawing an I-485 application terminates the associated EAD, Advance Parole, and all procedural protections tied to the pending case.
• Building the discretionary record early may be beneficial. Compiling evidence of tax compliance, continuous lawful employment, community involvement, and professional achievements, and submitting this documentation proactively rather than waiting for an RFE, is a strategy many immigration attorneys are exploring.
• Maintaining the underlying nonimmigrant status remains important. Allowing H-1B, L-1, F-1 OPT, or other status to lapse simply because an I-485 is pending may create risk.
• International travel on Advance Parole may carry elevated risk because the discretionary record may be reexamined both at re-entry and at final adjudication.
• Addressing negative factors proactively may strengthen a case. If there is a prior overstay, unauthorized work period, or visa denial in the record, documenting it with a legal explanation and supporting evidence before USCIS raises the issue is an approach many practitioners are considering.

EAD and Advance Parole Implications

The memo does not ban EAD (I-765) or Advance Parole (I-131) adjudication for pending I-485 cases, and these forms can still be filed concurrently. However, the practical risk has increased in two ways.

First, a discretionary denial of the I-485 will terminate the associated EAD and Advance Parole. If the underlying nonimmigrant status has already lapsed and the applicant relies solely on a pending I-485 for work authorization and lawful presence, a denial would leave the applicant without status and potentially subject to removal proceedings.

Second, this sits on top of the October 30, 2025 DHS interim final rule (Federal Register Doc. No. 2025-19702) that ended the automatic 540-day EAD extension for renewal applications filed on or after that date. The 540-day extension had been established by the December 13, 2024 final rule, effective January 13, 2025; applications filed before October 30, 2025 retain the 540-day extension. STEM OPT extensions (governed by 8 CFR 274a.12(b)(6)(iv)) and TPS-related EADs are governed by separate rules and are not affected by this IFR. Combined with the new discretionary framework, RFE-driven delays on the I-485 can now cause work-authorization gaps that previously would not have occurred.

Consular Processing as an Alternative

The memo frames consular processing as the "ordinary" path and adjustment of status as the exception. However, switching from AOS to consular processing is not a simple calculation, and for many applicants it may create more risk than it resolves.

Risks associated with switching to consular processing:

• Applicants who have accrued more than 180 days of unlawful presence after age 18 trigger a 3-year bar on re-entry under INA Section 212(a)(9)(B)(i)(I); more than one year triggers a 10-year bar under INA Section 212(a)(9)(B)(i)(II). Both bars are triggered upon departure from the U.S.
• The Department of State announced on January 14, 2026 a pause on immigrant visa processing for nationals of 75 countries, effective January 21, 2026, on public-charge grounds. This is a separate policy from Proclamation 10998's 39-country travel ban effective January 1, 2026, and from USCIS Policy Memoranda PM-602-0192 (dated December 2, 2025) and PM-602-0194 (dated January 1, 2026), which place adjudicative holds on USCIS benefit applications for nationals of certain countries. Applicants from affected countries may be able to interview but may not receive a visa while the pause remains in effect.
• Departing the U.S. ends EAD and Advance Parole tied to the pending I-485.
• Children protected under the Child Status Protection Act (CSPA) on a pending I-485 may face age-out risk if the case is transferred to consular processing, because the "sought to acquire" requirement under INA Section 203(h)(1)(A) is satisfied differently for AOS versus consular processing.
• Consular wait times at many embassies are comparable to or longer than domestic AOS timelines. As of May 2026, USCIS processing times for employment-based I-485 applications range from approximately 9 to 42.5 months depending on classification (based on USCIS's 80th-percentile completion methodology). Current processing times are available at egov.uscis.gov/processing-times.

The decision to pursue consular processing instead of AOS is highly fact-specific and depends on unlawful-presence exposure, country of chargeability, family considerations, and the current status of consular operations at the relevant embassy.

What This Means for Employers

Employers sponsoring foreign national employees face a changed risk profile for every sponsored I-485 case under PM-602-0199. The memo does not change employer obligations, but it elevates the importance of compliance and documentation.

Areas of focus for employers and HR teams:

• Auditing the full I-485 inventory. Identifying every pending case and triaging by risk level (status gaps, prior violations, visa history without statutory dual intent, and any other adverse factors) may help prioritize resources.
• Evaluating dual-intent transitions for vulnerable employees. If an employee is on a TN, O-1, E-3, or F-1 and has not yet filed for adjustment, evaluating whether obtaining H-1B or L-1 status first might reduce discretionary risk is an approach being explored, taking into account the $100,000 per-petition supplemental fee (Proclamation No. 10973, 90 Fed. Reg. 46,027, effective September 21, 2025) for certain new H-1B petitions and H-1B lottery selection rates.
• Communicating proactively with sponsored employees. Processing timelines may lengthen, RFEs may increase, and outcomes may depend more heavily on individualized facts.
• Tightening immigration compliance protocols. Minor violations that may have been overlooked before, such as late extension filings, brief status gaps, or LCA wage discrepancies, now feed directly into the discretionary analysis.
• Budgeting for higher legal spend per case. Cases that were once routine filings may now require curated discretionary packets, detailed cover letters, and RFE responses.

Read more about how Alma helps businesses manage immigration at scale: Alma for Businesses

Litigation Landscape as of Late May 2026

As of May 27, 2026, no federal court has issued an injunction or temporary restraining order targeting PM-602-0199 specifically. APA-based challenges (on notice-and-comment, retroactivity, and statutory-authority grounds) are widely anticipated, but no such suit has been filed yet.

Related litigation in the same policy cluster includes the consolidated cases Akmurat O. Doe v. Trump, No. 1:25-cv-13946, and Abeer H. Doe v. Trump, No. 1:26-cv-11382 (both D. Mass., before Judge Julia E. Kobick), where a May 7, 2026 order extended a preliminary injunction to 266 named plaintiffs, enjoining enforcement of USCIS Policy Memoranda PM-602-0192 and PM-602-0194 and Policy Alert PA-2025-26 against those plaintiffs. These memos, which imposed adjudicative holds on benefit applications for nationals of certain countries, are distinct from PM-602-0199 but part of the broader policy shift.

Regarding the $100,000 H-1B supplemental fee, the D.D.C. in Chamber of Commerce v. DHS, No. 1:25-cv-03675, issued a final order on December 23, 2025, denying the plaintiffs’ motion, granting the government’s cross-motion for summary judgment, and dismissing the complaint. By formally upholding the legality of Presidential Proclamation 10973, the court's ruling left the mandatory fee fully in effect, prompting the U.S. Chamber of Commerce to appeal to the D.C. Circuit (No. 25-5473) on December 29, 2025, where the matter remains pending. A separate challenge, Global Nurse Force v. Trump, No. 4:25-cv-08454-HSG (N.D. Cal., before Judge Haywood S. Gilliam, Jr.), also remains pending; the motion for a preliminary injunction was argued on February 26, 2026, and the matter remains under submission with no ruling issued as of May 27, 2026.

Why Choose Alma to Navigate PM-602-0199

See how Alma has helped employees and employers through complex immigration cases: Alma Case Studies

The new AOS policy raises the stakes for every green card application. What used to be a documentation checklist is now a legal argument that requires strategic presentation of the strongest equities and preemptive handling of any adverse factors. Alma's attorney-led, technology-enabled platform is built for exactly this kind of environment.

How Alma responds to PM-602-0199:

Discretionary evidence building: Alma attorneys are already incorporating "discretionary packets" into every I-485 filing, documenting positive equities such as tax compliance, community involvement, employer reliance, and professional achievements from the initial submission rather than waiting for an RFE.

Proactive adverse factor auditing: For employers with multiple pending cases, Alma's platform provides real-time case tracking that flags potential risk factors, including status gaps, prior violations, and visa histories without statutory dual intent, so teams can address issues before USCIS raises them.

Experienced attorneys: Alma attorneys have extensive experience preparing employment-based green card applications (EB-1, EB-2 NIW, EB-2 PERM, EB-3) and understand how to position cases under the current adjudication climate.

Transparent, flat-fee pricing: Alma's pricing covers attorney expertise, paralegal support, platform access, compliance tracking, and employee communication, with RFE responses included at no additional cost. No hourly billing surprises. Employer-sponsored cases include full compliance support.

Schedule a consultation to assess a case under the new AOS policy.