Excise Tax · IRC §4475 · P.L. 119-21 §70604
1% Remittance Transfer Tax Calculator
Most senders owe nothing. The 1% tax applies only when you fund the transfer with cash, a money order or a cashier's check and the recipient is in a foreign country. Card- and bank-funded transfers are exempt. This calculator is for a sender located in the U.S. (including territories and D.C.) sending mainly for personal or family purposes.
§4475 reaches only a transfer to a designated recipient located outside the United States. A domestic transfer is out of scope entirely.
Turn off for a transfer made mainly for business purposes: under Regulation E and the proposed regulations that is not a remittance transfer, so the tax doesn't apply.
The proposed regulations (REG issued 2026-04-13) exclude small-value transactions of $15 or less from the definition of a remittance transfer, so those carry no tax.
Excise tax per transfer
$5
- Total cost per transfer
- $505
- Tax over 12 transfers
- $60
Cash is the core taxable funding method named in §4475. Walk-in transfers paid in cash are the transactions this tax was written for.
Which funding methods are taxed at 1%?
| Funding method | 1% tax applies? |
|---|---|
| Cash handed over at a counter or agent location | Yes |
| Money order | Yes |
| Cashier's check | Yes |
| Bank account / ACH transfer | No |
| Debit card | No |
| Credit card | No |
| App or wallet balance funded from a linked bank account or card | No |
Full exemption detail and collection mechanics are in the remittance tax guide .
Frequently asked questions
Do I owe the 1% remittance tax on a bank transfer?
No. Under the proposed regulations, the §4475 excise tax applies only to transfers funded with cash, a money order, a cashier's check, or a similar physical instrument. Transfers funded from a bank account, debit card, or credit card are not taxable.
Who pays the tax?
The sender bears it, but the remittance transfer provider collects it at the point of sale and remits it to the Treasury quarterly. You should see it as a separate line on the receipt.
When did it start?
The tax applies to remittance transfers made after December 31, 2025 — that is, from 2026/01/01. Proposed regulations followed on 2026/04/13.
Can I avoid it?
Legitimately, yes: fund the same transfer from a bank account or card instead of handing over cash. On a $1,000 transfer that is a $10 difference, which usually exceeds the fee gap between funding methods.
Sources & References
Primary references used for this content
Excise tax on remittance transfers
Rate, taxable funding methods, and collection
View on law.cornell.edu
One Big Beautiful Bill Act
Enactment and January 1, 2026 effective date
View on congress.gov
Excise Tax on Remittance Transfers (proposed regulations)
Proposed regulations issued 2026-04-13
View on federalregister.gov
✓3 primary sources; links re-checked on a weekly rotation by the source watcher
Disclaimer: This calculator provides estimates for educational purposes only. Not tax, legal, or financial advice. Results may vary based on your specific circumstances. Consult a qualified CPA or tax professional for personalized guidance.