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Title 26 — Internal Revenue CodeRelease 119-73

§4475 Imposition of Tax

Title 26 › Subtitle Subtitle D— Miscellaneous Excise Taxes › Chapter 36— CERTAIN OTHER EXCISE TAXES › Subchapter C— Remittance Transfers › § 4475

Last updated Apr 6, 2026|Official source

Summary

If you send money abroad through a remittance transfer and pay with cash, a money order, a cashier's check, or a similar physical instrument, you owe a tax of 1 percent of the amount sent. The transfer company collects the tax from you and sends it to the IRS every quarter. If the tax is not collected when you send the money, the transfer company has to pay it. The tax does not apply when the money comes out of an account at a regulated bank or similar financial institution, or when you fund the transfer with a debit or credit card issued in the United States.

Full Legal Text

Title 26, §4475

Internal Revenue Code — Source: USLM XML via OLRC

(a)There is hereby imposed on any remittance transfer a tax equal to 1 percent of the amount of such transfer.
(b)(1)The tax imposed by this section with respect to any remittance transfer shall be paid by the sender with respect to such transfer.
(2)The remittance transfer provider with respect to any remittance transfer shall collect the amount of the tax imposed under subsection (a) with respect to such transfer from the sender and remit such tax quarterly to the Secretary at such time and in such manner as provided by the Secretary,11 So in original. The comma probably should be a period.
(3)Where any tax imposed by subsection (a) is not paid at the time the transfer is made, then to the extent that such tax is not collected, such tax shall be paid by the remittance transfer provider.
(c)The tax imposed under subsection (a) shall apply only to any remittance transfer for which the sender provides cash, a money order, a cashier’s check, or any other similar physical instrument (as determined by the Secretary) to the remittance transfer provider.
(d)Subsection (a) shall not apply to any remittance transfer for which the funds being transferred are—
(1)withdrawn from an account held in or by a financial institution—
(A)which is described in subparagraphs (A) through (H) of section 5312(a)(2) of title 31, United States Code, and
(B)that is subject to the requirements under subchapter II of chapter 53 of such title, or
(2)funded with a debit card or a credit card which is issued in the United States.
(e)For purposes of this section—
(1)The terms “remittance transfer”, “remittance transfer provider”, and “sender” shall each have the respective meanings given such terms by section 919(g) of the Electronic Fund Transfer Act (15 U.S.C. 1693o–1(g)).
(2)The term “credit card” has the same meaning given such term under section 920(c)(3) of the Electronic Fund Transfer Act (15 U.S.C. 1693o–2(c)(3)).
(3)The term “debit card” has the same meaning given such term under section 920(c)(2) of the Electronic Fund Transfer Act (15 U.S.C. 1693o–2(c)(2)), without regard to subparagraph (B) of such section.
(f)For purposes of section 7701(l), with respect to any multiple-party arrangements involving the sender, a remittance transfer shall be treated as a financing transaction.

Legislative History

Notes & Related Subsidiaries

Statutory Notes and Related Subsidiaries

Effective Date

Pub. L. 119–21, title VII, § 70604(c), July 4, 2025, 139 Stat. 286, provided that: “The

Amendments

made by this section [enacting this subchapter] shall apply to transfers made after December 31, 2025.”

Reference

Citations & Metadata

Citation

26 U.S.C. § 4475

Title 26 — Internal Revenue Code

Last Updated

Apr 6, 2026

Release point: 119-73