Good News For NRIs And H-1B Workers: US Reduces Remittance Tax To 3.5%
Updated: 26-05-2025 at 3:31 PM
1k
🚀
10M+
Reach – Join the
Movement!
❓
50K+
Queries Answered
- Ask Yours Today!
🔥
1.5L+
Users Benefiting
- Why Not You?
🚀
10M+
Reach – Join the
Movement!
❓
50K+
Queries Answered
- Ask Yours Today!
🔥
1.5L+
Users Benefiting
- Why Not You?
The US House of Representatives just voted to pass the ‘One Big Beautiful Bill Act’, which cuts the remittance tax for millions of immigrants from 5% to 3.5%. From January 1, 2026, non-citizens sending money out of the country will have to pay this tax. The amendment is extra beneficial for people on H-1B visas and those living outside the US, as they usually send money to their families at home.
Key Highlights Of This Bill
To grasp how this new US tax law affects us, let’s identify the main points. Let’s look at the main points you should know.
-
Tax Reduction: The remittance tax rate has been cut from 5% to 3.5% after the Manager’s Amendment was accepted.
-
Effective Date: The new rate will start being applied on January 1, 2026.
-
Applicability: This is a tax for non-Americans living in the country, including NRIs and people on the H-1B visa.
-
Exemptions: When transactions are made with qualified remittance transfer providers, US citizens and nationals aren’t subject to this tax.
-
Collection Mechanism: The tax will be collected by approved remittance transfer specialists and given over to the US Treasury every three months.
-
Impact on Indian Diaspora: The financial implications for the Indian community in the US are likely to be major since the US makes up $33 billion in remittances to India.
Also Read: Proof Of Screenshot Mandated To Apply For GST Amnesty Scheme: Latest Update
Implications For NRIs And H-1B Workers
It is good news for NRIs and H-1B visa holders who regularly send funds to India, as the tax rate on such payments has been reduced. Instead of the earlier $60 (Rs 5,000), taxes will be collected at $42 (Rs 3,500) on a remittance of $1,200 (Rs 1 lakh).
Even so, adopting this tax brings an extra financial pressure for a lot of individuals. Individuals should properly organise their financial affairs and learn when the bill will be finalised.
Impact On Indians Living In The USA
Among immigrant communities in the US, more than 4.46 million Indians make up one of the biggest groups. As over $33 billion in remittances are sent from the US to India every year, the tax could have a big impact.
Because of this extra cost, some might choose to use unofficial means of sending money, which might raise the use of such channels. A shift here could cause greater opaqueness and might confront the industry with regulatory issues.
Also Read: Guide To Filing Taxes In May 2025: Follow The Deadline, Dues, Penalties & More
Conclusion
The 'One Big Beautiful Bill Act’s lower remittance tax rate helps ease things for people from India living in the US. Though the 3.5% tax is lower than originally discussed, it will still add costs to sending money away. Both NRIs and H-1B workers ought to pay close attention to current legislative news and consider using a financial advisor to smoothly adjust to the new rules.
Get the latest updates on government schemes and policies with Jaagruk Bharat. Join India's biggest Jaagruk Bharat community. Share your thoughts, questions, and favourite topics with us.
0
0
1k
0
0
1k Views
0
No comments available
Our Company
Home
About
T&C
Privacy Policy
Eula
Disclaimer Policy
Code of Ethics
Contact Us
Cancellation & Refund Policy
Categories
Women
Insurance
Finance
Tax
Travel
Transport & Infrastructure
Food
Entertainment
Communication
Government ID Cards
E-commerce
Traffic guidelines
Miscellaneous
Housing and Sanitation
Sports
Startup
Environment and Safety
Education
Agriculture
Social cause
Disclaimer: Jaagruk Bharat is a private organization offering support for documentation and government scheme access. We are not affiliated with any government body. Official services are available on respective government portals. Our goal is to make processes easier and more accessible for citizens.
Jaagruk Bharat with its team work tirelessly to bring all government schemes, Sarkari Yojanas, policies and guidelines to you in a simplified and structured format.
Our team is at the forefront of gathering, verifying and breaking all central government and state government regulations uncomplicatedly.
Our mission and vision are to make the common citizen of India aware of all government-laid-out rules and policies in a single place. Thus, we Jagruk Bharat have created an all-inclusive portal for 1.5 billion Indian citizens to understand, utilize and avail benefits of govt schemes and policies and by bringing them under one roof.
Jaagruk Bharat (जागरूक भारत) is a one stop centralised destination where you can effortlessly find, understand, and apply for various government schemes. We are committed to ensuring transparency and empowering Indian citizens. Our goal is to keep India Jagruk about government policies, the latest news, updates, and opportunities.
All Copyrights are reserved by Jaagruk Bharat