Sponsors (2)
The bill sharply raises the cost of most remittances and increases provider reporting to raise revenue and oversight while offering exemptions and a refundable credit to verified U.S. citizens — a trade-off between greater government revenue/visibility and higher costs plus privacy and compliance burdens for senders and providers.
Low-income U.S. taxpayers (including low-income senders) can recover some or all of remittance taxes paid through a new refundable income tax credit (§36C), reducing net cost for eligible filers once effective.
Verified U.S. citizen senders who use qualified providers and complete verification are exempt from the 15% remittance excise tax, lowering costs for those who successfully verify their status.
New reporting and documentation requirements increase transparency about remittance flows and tax-exempt transfers, giving Treasury and regulators better oversight of cross-border payments.
Most people who send money abroad (particularly immigrant and low-income households) will face a much higher excise tax—rising from about 1% to 15%—substantially increasing the cost of remittances.
Senders who must verify U.S. citizenship to obtain the exemption or refundable credit will face administrative burdens and privacy risks from providing SSNs and documentation.
Money-transfer providers and other financial institutions must comply with new reporting, verification agreements, and face penalties, raising their compliance costs that are likely to be passed on to consumers as higher fees.
Based on analysis of 2 sections of legislative text.
Raises the remittance excise tax from 1% to 15%, creates a verification-based exemption for U.S. senders, adds a refundable credit for U.S. citizens, and imposes new reporting rules on providers.
Official title: To amend the Internal Revenue Code of 1986 to modify the tax on remittance transfers.
Introduced September 26, 2025 by John J. McGuire · Last progress September 26, 2025
Raises the federal excise tax on remittance transfers from 1% to 15%, creates an exemption for transfers by verified U.S. senders through providers that sign verification agreements, and establishes a refundable tax credit allowing U.S. citizens and nationals to reclaim excise taxes they paid. It also requires new reporting and disclosure rules for remittance providers and adds penalties for failures to file, with many changes tied to the effective date of a listed public law and the tax credit phased in for taxable years ending after December 31, 2025.