Until recently, if a cap-subject H-1B application was withdrawn by the sponsoring company prior to October 1 (start date of employment under H-1B), the Beneficiary was not counted against the H1-B cap. However, in a meeting with American Immigration Lawyers Association (AILA) in May 2014, USCIS has stipulated an additional condition for H1-B petitions filed under consular processing. According to the USCIS, a Beneficiary, whose H1-B application is filed under consular processing, will also not be counted against the H1-B cap if the sponsoring company withdraws the H-1B application prior to such Beneficiary applying for (i) H-1B visa stamp, and (ii) admission into the U.S., irrespective of whether such withdrawal occurs prior to, or after, October 1.
Moreover, USCIS is now rejecting new H1-B applications as cap subject for a Beneficiary who has an approved H-1B in the last six (6) years, even if the H-1B application has not been revoked by the employer. USCIS is of the opinion that if the Beneficiary has not completed all of the steps for effectuating his / her H-1B status, i.e. the Beneficiary has not been issued H-1B visa and admitted into the US or if in the US, changed status to H-1B, the Beneficiary is cap subject. For example, the USCIS has recently denied an H-1B change of status application as cap subject for a Beneficiary with a previously approved H-1B under FY 2015 quota as the Beneficiary had not yet changed status to H-1B and not yet commenced employment with the initial sponsoring company, the H-1B start date was October 1, 2014