I found this from Shusterman's news letter. I thought this would be helpful for people who have spent sometime outside, e.g. vacations, while on H1B. I'm copying it here from the news letter.
A new precedent CIS decision states that only time that a person is physically present in H-1B or L-1 status in the status counts toward the maximum duration of their stay (5 years for L-1Bs; 6 years for H-1Bs; and 7 years for L-1As). Any time outside of the U.S. may be "recaptured". The complete text of the decision is at:
http://uscis.gov/graphics/lawsregs/admindec3/d2/2005/sep0205_02d2101.pdf
A new precedent CIS decision states that only time that a person is physically present in H-1B or L-1 status in the status counts toward the maximum duration of their stay (5 years for L-1Bs; 6 years for H-1Bs; and 7 years for L-1As). Any time outside of the U.S. may be "recaptured". The complete text of the decision is at:
http://uscis.gov/graphics/lawsregs/admindec3/d2/2005/sep0205_02d2101.pdf