Despite their similarity, important differences exist between L-1 and H-1B status, as outlined below.
There are no formal educational requirements to obtain an L-1 visa. Of course, an employer is likely to require some sort of higher education from, say, an executive, and the USCIS might doubt the authenticity of an application filed on behalf of an executive with no formal education. It’s just that the USCIS doesn’t absolutely require a degree to issue an L1 visa.
On the other hand, an H-1B applicant must possess at least a bachelor’s degree or its equivalent. An H-1B applicant is also expected to possess expertise in a “specialty occupation.” In some cases, the USCIS will allow hands-on work experience to substitute for formal education, meaning that the applicant must establish the equivalent of a bachelor’s degree through a combination of education and work experience.
To qualify to sponsor an employee for an L-1 visa, your company must qualify as “multinational” as defined by US immigration law. It must be doing business in the US and at least one other country, and it must have a qualifying relationship with a company located abroad (a subsidiary, for example).
The sponsored employee must have worked for the same company overseas, or have worked for an overseas company with a qualifying affiliation with the sponsoring company, for at least one out of the past three years.
By contrast, a US-based company (and only a US-based company) can sponsor an employee under the H-1B category.
Period of Stay
L-1 visa holders are normally granted a two-year period of stay when they first enter the US. If they are coming to establish a new office, however, only a one-year period of stay is granted. The L-1 holder can extend his period of stay in two-year increments until the maximum time limit is reached. For an L-1A holder, this limit is seven years, while for an L-1B holder, it is only five years.
After the L1 limit is reached, no extensions will be allowed — the employee must either return home permanently, qualify under another visa status, or return home to re-qualify for another L-1 visa (this will take at least a year of additional work experience abroad).
An H-1B visa holder, by contrast, is typically granted an initial three-year period of stay, which can be extended one for another three years, or extended in smaller increments until the six-year limit is reached. In certain limited instances, an H-1B holder is eligible to extend beyond this six-year limit.
Keep in mind also that time spent in the US in H-1B status will count against the L-1 deadline, and vice versa.
Limitations on the Total Number of Visas Issued (Quotas)
There is no quota limitation for the L-1 visa. It’s a different story for the H-1B visa, however — there is an annual cap of 65,000 visas, plus another 20,000 visas allowed for applicants who hold advanced degrees (beyond a bachelor’s degree). In many years the H-1B quota represents far less than half the total number of applications received by the USCIS. Neither of these caps apply to universities or non-profit organizations.