The US Department of the Treasury and the Internal Revenue Service announced, on 10 April 206, that it has proposed regulations that would provide rules and definitions related to the new excise tax imposed on certain remittance transfers, also referred to as the remittance transfer tax, under the One, Big, Beautiful Bill.
Beginning 1 January 2026, a 1% remittance transfer tax applies to remittances sent from the United States to recipients in foreign countries when the sender provides cash, a money order, a cashier’s check, or other similar physical instrument to the remittance transfer provider. The sender is liable for the tax, and remittance transfer providers are required to collect the remittance transfer tax from certain senders, make semimonthly deposits, and file quarterly returns with the IRS. If the remittance transfer provider does not collect the tax from the sender, the tax becomes a liability of the remittance transfer provider.
The proposed regulations clarify the application of the remittance transfer tax, including:
- specifying the amount on which the remittance transfer tax is imposed;
- determining the full scope of physical instruments that trigger the tax; and
- providing examples illustrating the application of these proposed definitions and rules.
Remittance transfer providers report the new remittance transfer tax on Form 720, Quarterly Federal Excise Tax Return, with the first semimonthly deposits due Jan. 29, 2026. In October 2025, the IRS issued Notice 2025-55 providing limited penalty relief for remittance transfer providers who fail to deposit the correct amount of the remittance transfer tax as required during the first three quarters of 2026.
Treasury and IRS request comments from the public within 60 days to be made through Regulations.gov.
Complete instructions on submitting comments can be found in the proposed regulations.
Comments on the proposed regulations are due by 12 June 2026.
