When the One Big, Beautiful Bill Act (OBBBA) was passed on July 4th, 2025, all the tax professionals focused on the new tax deductions (i.e. car interest deduction, no tax on overtime or tips, etc.), extension to some of the Tax Cuts and Job Act tax benefits, and other relevant items (i.e. new estate tax $15 million dollar threshold).

However, in the fine print, you can find a brand-new 1% excise tax on certain remittance transfers, effective January 1, 2026. This 1% excise tax is applicable to individuals and small business that trade internationally

  • Cash remittances sent through money service businesses

  • International money orders

  • Cashier’s checks used for cross-border payments

  • Other physical instruments outside the banking system

Note that if you send those funds through bank channels like wire transfer or ACH electronic transfer or using cryptocurrency, those transactions are exempt.

If you are wondering if the IRS is serious about it, the short answer is yes. In October, the IRS issued Notice 2025-55 (IR-2025-102), granting penalty relief for the first three quarters of 2026 as remittance providers will need time to adjust systems to collect and deposit this new tax correctly.

As always, the fine print matters. The new 1% remittance excise tax comes with detailed rules, definitions, and exceptions that can easily be overlooked. If you or your business regularly send funds abroad, take a moment to review how this change may affect you. If you have any questions or would like guidance specific to your situation, don’t hesitate to contact the GG CPA Services team. We’re here to help you stay compliant and plan ahead before these rules take effect in 2026.

 

Link IRS – Treasury, IRS provide penalty relief for remittance transfer providers who fail to deposit excise tax under the One, Big, Beautiful Bill

Link Forbes – Two Big Tax Changes That Could Hit Working-Class Households Under Trump’s “Big Beautiful Bill”