USCIS Signals Heightened Discretionary Review of Adjustment of Status Applications

U.S. Citizenship and Immigration Services (USCIS) issued Policy Memorandum PM-602-0199 on May 21, 2026, emphasizing that eligibility for adjustment of status does not automatically entitle an applicant to approval.

Adjustment of status allows an eligible foreign national who is physically present in the United States to apply for lawful permanent residence by filing Form I-485. This process generally permits the applicant to complete the final stage of the green card process without leaving the United States to obtain an immigrant visa at a U.S. embassy or consulate.

The new memorandum does not eliminate adjustment of status or change its statutory eligibility requirements. It does, however, direct officers to examine whether each applicant merits approval as an exercise of discretion, taking into account the full circumstances of the case.

Eligibility and Discretion Are Separate Questions

An adjustment of status adjudication generally involves two distinct inquiries:

1. Is the applicant legally eligible to adjust status?
2. Does the applicant merit a favorable exercise of discretion?

Eligibility may depend on factors such as lawful admission or parole, visa availability, an approved or concurrently filed immigrant petition, admissibility, maintenance of status, and the applicability of any statutory exceptions.

Satisfying those requirements does not necessarily require USCIS to approve the application. Section 245(a) of the Immigration and Nationality Act provides that an eligible applicant’s status “may be adjusted” in the discretion of the government.

USCIS has long described discretionary approval as a matter of administrative grace. Policy Memorandum PM-602-0199 gives this discretionary component greater prominence and characterizes adjustment as an extraordinary alternative to the regular consular immigrant visa process.

Consular Processing May Receive Greater Attention

The memorandum directs officers to consider the availability of consular processing when deciding whether an applicant deserves favorable discretion.

Under consular processing, the applicant generally completes immigrant visa processing through the Department of State and attends an interview at a U.S. embassy or consulate outside the United States. If the immigrant visa is approved, the applicant becomes a lawful permanent resident upon admission to the United States.

The memorandum does not require every applicant with access to consular processing to leave the United States. Nor does the existence of a consular-processing option automatically disqualify someone from adjustment of status.

However, applicants may face closer examination concerning:

• Why they entered the United States in a temporary status;
• What representations they made when applying for a visa or admission;
• When and why their plans changed;
• Whether they complied with their nonimmigrant classification;
• Why they are pursuing adjustment rather than consular processing; and
• Whether the overall record supports favorable discretion.

The availability of consular processing is one consideration within a broader individualized assessment.

Factors USCIS May Consider

Officers must evaluate the positive and negative circumstances presented by each case. No single list applies identically to every applicant, and the weight given to a particular factor will depend on the surrounding facts.

Potentially favorable considerations

Positive factors may include:

• Close family relationships in the United States;
• Long-term lawful residence;
• Consistent compliance with immigration requirements;
• Stable employment or business activity;
• Payment of required taxes;
• Community involvement;
• Evidence of good moral character;
• Hardship to the applicant or qualifying family members;
• Significant professional, economic, or public-interest contributions; and
• Other circumstances supporting completion of the process in the United States.

Potentially adverse considerations

Negative factors may include:

• Fraud, misrepresentation, or false testimony;
• Unauthorized employment;
• Failure to maintain status;
• Violations of the conditions of admission or parole;
• Conduct inconsistent with representations made to a consular or immigration officer;
• Criminal conduct or other adverse character evidence;
• Repeated immigration violations;
• Lack of candor in forms or interviews; and
• Other facts suggesting that favorable discretion is not warranted.

Some adverse conduct may also create a separate statutory ground of inadmissibility or ineligibility. Discretion does not replace those legal analyses.

Effect on L-1 and Other Dual-Intent Applicants

The memorandum recognizes that applying for permanent residence is not inherently inconsistent with maintaining a dual-intent nonimmigrant classification.

The H-1B and L-1 categories permit a foreign national to hold temporary nonimmigrant status while also pursuing permanent residence. Their H-4 and L-2 dependents receive related protections under the dual-intent framework.

Accordingly, an L-1A executive or manager does not violate L-1 status merely by pursuing an EB-1C immigrant petition or filing an eligible adjustment application. Similarly, the existence of an approved or pending immigrant petition does not, by itself, establish improper intent.

However, dual intent does not guarantee discretionary approval of Form I-485. USCIS may still evaluate the applicant’s complete immigration history, conduct, representations, and other positive or negative circumstances.

This distinction is particularly important for multinational executives pursuing the common L-1A-to-EB-1C pathway. The underlying immigrant classification and adjustment application serve different functions and are adjudicated under different legal standards.

Pending and Future Form I-485 Applications

The memorandum does not cancel pending adjustment applications or prevent USCIS from accepting new filings from otherwise eligible applicants.

Applicants should not assume, however, that a technically approvable petition will result in automatic approval of the related Form I-485. Pending and future cases may receive additional discretionary review, particularly where the record includes:

• Status violations;
• Unauthorized employment;
• Conflicting statements;
• Questions regarding intent at admission;
• Prior visa refusals;
• Criminal or enforcement history; or
• Other unfavorable facts.

USCIS may issue a Request for Evidence, schedule an interview, or question the applicant about the decision to pursue adjustment rather than consular processing.

Denials Based on Discretion

When USCIS denies an adjustment application solely or partly as an unfavorable exercise of discretion, the decision should identify the positive and negative considerations evaluated and explain why the adverse factors outweigh the favorable ones.

The existence of this written-analysis requirement does not guarantee that USCIS will issue an RFE or Notice of Intent to Deny before making its decision. Applicants should therefore present relevant favorable evidence with the initial filing whenever possible.

A discretionary denial may also affect the applicant’s ability to remain in the United States, particularly if the applicant no longer holds independent nonimmigrant status. Maintaining valid underlying status, when available and strategically appropriate, may provide an important safeguard while Form I-485 remains pending.

Adjustment of Status Versus Consular Processing

Applicants should not automatically abandon adjustment of status in response to the memorandum. Both adjustment and consular processing have important advantages and risks.

Adjustment of status may allow an applicant to:

• Remain in the United States during adjudication;
• Apply for employment authorization when eligible;
• Request advance parole for travel;
• Continue residing with family members; and
• Avoid the immediate disruption of an overseas immigrant visa interview.

Consular processing may avoid certain adjustment-specific eligibility requirements, but it can involve:

• International travel;
• Medical examinations abroad;
• Consular interview scheduling;
• Possible administrative processing;
• Delays outside the United States; and
• Limited review of a consular refusal.

The appropriate process depends on the applicant’s immigration history, current status, travel needs, family circumstances, admissibility, visa availability, and tolerance for procedural risk.

Practical Steps for Applicants

Prospective adjustment applicants should consider taking the following steps:

1. Review the complete immigration history. Confirm that prior petitions, visa applications, admission records, and immigration forms are accurate and consistent.
2. Identify adverse facts before filing. Status violations, unauthorized employment, arrests, prior refusals, and inconsistent statements require careful evaluation.
3. Document favorable equities. Where discretion may be contested, applicants should provide credible evidence of family, employment, business, tax, community, and humanitarian considerations.
4. Preserve underlying status where possible. Continued L-1, H-1B, or other valid status may provide protection if the adjustment application is delayed or denied.
5. Compare both permanent-residence processes. Adjustment of status and consular processing should be evaluated individually rather than selected solely for convenience.
6. Prepare for additional questioning. Applicants should be ready to explain their original purpose of entry, subsequent immigration decisions, and reasons for completing the process in the United States.

What the Memorandum Does Not Resolve

Several implementation questions remain. USCIS has not established a categorical rule identifying which applicants must use consular processing, nor has it specified a fixed combination of favorable factors that will ensure discretionary approval.

The guidance also does not assign universal weight to individual factors. Officers must continue to evaluate each application on its own record.

For applicants, the central practical change is therefore not a new filing prohibition, but an increased need to demonstrate both legal eligibility and why the totality of the circumstances supports approval.

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This blog was published on 10 August 2026 and reflects information available at that time. Updates may occur as policies evolve. To stay informed on the latest immigration news and analysis, please subscribe to our alerts and follow us on LinkedIn, Twitter, Facebook and Instagram. 

Phoenix Business Advisory assists entrepreneurs, executives, investors, and professionals with employment-based immigration and long-term business-migration planning. Applicants should evaluate visa availability as part of a broader strategy that accounts for petition timing, nonimmigrant status, adjustment of status, consular processing, and potential category alternatives.

This article is provided for general informational purposes and does not constitute legal advice. Businesses should consult qualified legal counsel regarding requirements applicable to their particular operations, workforce, and government contracts.