Is it possible to apply for H1B whilst out of status in USA?

[Phobos]

A good friend of mine finds himself in the following situation:

* He travelled to the USA in 2007 on a J1 with an i94 stamped D/S.

* He never left the USA and has been working and paying taxes with the SSN he was issued, by being less than honest on his I9.

So far he has avoided any problems and he recently discovered he is out of status rather than unauthorized due to the D/S i94, but he has obviously put himself in a serious situation that needs resolving one way or another. He is living with me and I am trying to help him figure out what to do next. I have the following questions and would be most grateful if anyone can shed some light on this:

1) He has a degree from a European university that has been found equivalent to a US masters, but it is in a humanities-related subject. Given his situation, is there any chance of him successfully finding an employer to sponsor him for an H1B whilst he remains in the USA?

2) Even if he found a potential sponsor willing to hire him, would there be big problems when it came to actually appyling for the H1B? Would USCIS be able to see he has significantly overstayed? Do they have access to his tax returns, and would they discover his years of unauthorized work?

3) Will his lengthy out of status presence here be discovered and count heavily against him in the end, regardless of where he applies for any subsequent visas from?

Realistically, is his only option to leave the USA and apply from abroad? I am sure I can convince him to leave if it really seems to be his best shot of making it over here legitimately in the future, which is all he really wants. He has been filing taxes because he wants to be a productive member of US society, but I fear in the end that his honesty in this one area may come back to haunt him.

Thanks in advance for your honest opinions, I won't take offence if anyone decides to be blunt and/or harsh regarding his chances, as I know he has gotten himself in a real mess here. However, he is a genuinely good guy, and I feel I need to do whart I can to help him become legal if possible.

[pontevecchio]

Help him by asking him to consult with the firm of Murthy as a first step. Everything else is speculation and in a forum you would get many less than ideal replies. One thing which can save him is a genuine Marriage to an USC. I am not going into the merits of hundreds of thousands waiting for years for a legal solution to their Immigration. Have him talk to a Lawyer.