A new bill has passed in the U.S. House of Representatives that directly affects Indians. The bill, called the “One Big Beautiful Bill Act” targets to impose a tax on all international money transfers made by individuals who are not US citizens. Starting from 1st January 2026, the United States may introduce a remittance tax of 3.5% on money sent abroad by non-U.S. citizens and foreign nationals. Earlier, the bill mentioned a 5% tax, but later on after some pushback from the Indian American Community , the percentage was reduced from 5% to 3.5% remittance tax on NRIs.
If the bill passed, the tax would apply to all foreign money transfers made by non-citizens, including F1-Visa, H-1B visa holders, green card applicants, and tourists who send money to their home countries.
This proposed remittance tax is raising concern globally, especially for those who send money back to India, where remittances play a significant role in the economy. As of now, the bill has passed the House, but it is yet to pass the Senate, and then it has to still be signed into law by President Trump. If it reaches the finish line, it will take effect from January 1st, 2026.
For NRIs and migrants, it’s important to stay updated. If this tax is approved, sending ₹1 Lakh from the U.S. could attract an additional ₹3,500 as tax. Consulting an expert tax consultant or a professional accountant will help avoid unexpected surprises when the law takes effect.
At KDP Accountants, we have recently assisted several NRIs in successfully transferring funds from the U.S. to India ahead of the proposed remittance tax rule. If you are planning an International money transfer and want to ensure it’s done efficiently and effectively with regulations, our team of experts is here to help.
Here, we help individuals and businesses navigate international tax matters, including business setup consultants, and cross-border financial compliance. Feel free to reach out to our expert team at enquire@kdpaccountants.com .
