US 1% Remittance Tax Enters Rule-Making as Comment Window Closes June 12
Cash-funded transfers are taxed; bank-account and US bank-card transfers are exempt; senders with Social Security numbers may be able to claim a credit.
The US 1% excise tax on certain remittances — created by the One Big Beautiful Bill Act and effective January 1 — has moved into IRS rule-making, with the comment period on proposed regulations closing June 12. The tax applies only to transfers funded with cash, money orders or cashier’s checks; transfers paid from a US bank account or US bank-issued debit or credit card are exempt.
This is the single highest-impact money signal for the diaspora right now. The practical move is to fund transfers digitally from a bank account or card to avoid the charge, and to keep records, since SSN holders may be able to recover the tax as a credit once reporting rules are finalised.