Starting January 1, 2026, the One Big Beautiful Bill Act imposed what excise tax on electronic fund transfers abroad?

The One Big Beautiful Bill Act, a significant piece of U.S. federal legislation, established a one percent excise tax on certain electronic fund transfers sent from the United States to foreign countries. This tax, which became effective on January 1, 2026, applies to a variety of remittance transfers made for personal, family, or household purposes. This means that when individuals send money abroad through methods like cash, money orders, cashier's checks, or even some wire transfers, an additional one percent of the transferred amount is levied as a tax. The tax is intended to be collected by the remittance transfer provider, though the burden of the tax falls on the sender.

The One Big Beautiful Bill Act, officially designated as P.L. 119-21 and signed into law on July 4, 2025, encompasses a broad range of tax and spending policies. While the excise tax on foreign fund transfers is a notable provision, the act also includes measures such as making permanent many of the individual tax rates from the 2017 Tax Cuts and Jobs Act, increasing the child tax credit, and adjusting various deductions. The introduction of this remittance tax represents a new approach to generating revenue and overseeing international money transfers.

It is important to note that not all international electronic fund transfers are subject to this excise tax. Exemptions include transfers of $15 or less and those directed to U.S. military bases located in foreign countries. Additionally, certain transfers funded through accounts at U.S. financial institutions, those made with U.S.-issued debit or credit cards, and cryptocurrency transfers are also generally exempt. This targeted application aims to balance revenue generation with considerations for common financial practices and military personnel.