Remittance Tax

Durhamlad referred to this tax on another thread.

I think it's useful for this topic to have a thread of its own

https://spammylink.pleasereportthispost.com/blog/remittance-tax/

Good idea to have a dedicated thread.

Here is another item on it.

https://odi.org/en/insights/why-taxing-remittances-will-harm-migrants-and-the-us-economy-trumps-one-big-beautiful-bill-act/

With deportation and migration controls ramping up, US President Donald Trump’s administration has enacted a new tax on remittances – the money migrants send home to their families from abroad.

Remittances are often the most direct and well-known link between migration and development. They can be a lifeline for families, helping them meet basic needs, invest in education and healthcare. Estimates suggest remittances are three to four times the total amount of foreign aid: in 2023, remittances to the Global South reached an estimated USD$656 billion, while foreign aid totalled around $224 billion.
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The passed tax is part of Trump’s 'Big Beautiful Bill' Act, a budget package that intends to fund his second-term agenda, including an estimated $170 billion dedicated for immigration enforcement and border-related operations. The tax was originally 5%, as proposed in the first version of the bill, it was then reduced to 3.5%, and now stands at 1% in the Senate’s version.

While previous versions of the tax only applied to non-US citizens, the passed tax applies to all remittance senders of cash transfers, money orders or cashier’s checks. It will add to the roughly 6% migrants already pay as fees to remittance service providers (such as Western Union or MoneyGram), banks and money transfer apps.

https://www.democratsabroad.org/a_summary_of_the_remittance_tax_for_americans_abroad_current_as_of_july_12_2025


What kind of transfers will not get hit with the 1% remittance tax?

Anything that is not a cash transfer, which includes transfers from your U.S. bank account, retirement account, brokerage account, online, or using a debit or credit card. Below are some examples. This list isn’t exhaustive.

    Initiating an international wire transfer from your U.S. bank to your non-U.S. bank account.
    Transferring your Social Security, 401(k), or IRA distributions from your U.S. bank to your non-U.S. bank account.
    Using WISE, Revolut, or any other online money transfer service to transfer money from the U.S. to your country of residence.