The Internal Revenue Service (IRS) imposed new regulations which will implement a 1 percent excise tax on certain overseas money transfers, requiring transfer entities to collect taxes from senders and quarterly reporting to the federal government.
A notice was posted on April 13, 2026, detailing propositions authorized under Section 4475 of the Internal Revenue Code set to apply to electronic fund transfers originating in the United States and sent to foreign countries.
Under President Trump’s One, Big, Beautiful Bill, the new rules will apply prospectively to post-2025 transfers once finalized, but the IRS states taxes will not apply to transfers funded by withdrawals from financial institutions and transactions under $15 dollars will be exempt.
New regulations indicate added oversight, with providers now required to make semi-monthly deposits of the collected tax on transfers. This will be reported to the federal government via Form 720 – the Quarterly Federal Excise Tax Return. If the tax fails to be collected or reported by the provider, they remain liable – strengthening accountability.
The IRS states that the regulations will further clarify tax scope, with efforts focused on reducing burden and maintaining transparency.
The Maine Bureau of Consumer Credit Protection oversees the state’s licensing of money transmitters, showing over 2,000 entities operating in Maine. These entities are facilitators of fund transmission, to include international money service businesses, operating under state regulatory oversight.
The new collection and reporting obligations impose additional responsibility on these entities, as the IRS estimates new taxes to directly impact money service businesses handling cash-based remittances, citing minimal anticipated impact on banks or credit unions.
As the comment period remains open, you can read the full Federal Register notice here:
https://www.federalregister.gov/documents/2026/04/13/2026-07085/excise-tax-on-remittance-transfers
