Key Takeaways
• A 3.5% remittance excise tax applies to non-U.S. citizens sending money abroad starting after December 31, 2025.
• Nonpayment or underpayment of this tax does not affect H-1B visa renewal or employer sponsorship.
• OBBB increases immigration fees and restricts benefits but the remittance tax is a financial, not immigration, rule.
As of July 2025, the United States 🇺🇸 is preparing for a significant change in how it taxes money sent abroad by non-citizens. The One Big Beautiful Bill Act (OBBB or H.R. 1) introduces a new remittance excise tax that directly affects many immigrants, including those working in the country on temporary visas like the H-1B visa. With the tax set to take effect for transfers sent after December 31, 2025, many are asking: Could failing to pay this tax—or paying too little—put their visa status or employer sponsorship at risk? Here’s what you need to know, why it matters, and how it could affect you or your employees.
What Is the Remittance Excise Tax and Who Does It Affect?
The remittance excise tax is a new tax created by the One Big Beautiful Bill Act. It applies to non-U.S. citizens who send money from the United States 🇺🇸 to family or others in other countries. The tax is set at 3.5% of the amount sent, which is lower than the original proposal of 5%. This tax will be collected by the companies or banks that handle the money transfers, starting with transfers made after December 31, 2025.
Key points about the remittance excise tax:
– Who pays: Only non-U.S. citizens must pay this tax. U.S. citizens are not charged.
– How it’s collected: The tax is taken out by the company or bank when you send money abroad.
– Why it exists: The government created this tax to raise money for federal programs.
– Who is most affected: Immigrant workers, including those on H-1B visas, who send money to support family members in their home countries.
This tax is controversial because it creates a system where immigrants pay more to send money home, while U.S. citizens do not. Many immigrant advocates say this is unfair and puts extra pressure on families who rely on these funds.
Does Underpaying the Remittance Excise Tax Affect H-1B Visa Renewals or Employer Sponsorship?
One of the biggest worries for H-1B visa holders and their employers is whether failing to pay this new tax—or paying too little—could lead to problems with visa renewals or sponsorship. According to the latest official documents and expert analysis, underpaying or not paying the remittance excise tax does not currently affect your H-1B visa status or your employer’s ability to sponsor you.
Here’s what the law and experts say:
– The remittance excise tax is a financial obligation, not an immigration rule.
– If you do not pay the tax, you may face tax penalties or fines—but not immigration penalties.
– There is no link between paying this tax and your eligibility for H-1B visa renewal or employer sponsorship.
– The U.S. government treats this tax like any other tax on financial transactions, separate from immigration enforcement.
In short: If you are an H-1B visa holder, not paying the remittance excise tax may cost you money in penalties, but it will not put your visa or job at risk under current law.
How Is the Remittance Excise Tax Enforced?
The government plans to enforce the remittance excise tax by requiring companies and banks that handle money transfers to check the citizenship status of people sending money abroad. If you are a non-U.S. citizen, the tax will be added to your transaction. If you are a U.S. citizen, you will not be charged.
Enforcement details:
– Verification: Companies must check if you are a U.S. citizen or not before processing your transfer.
– Collection: The tax is taken out automatically when you send money.
– Penalties: If you try to avoid the tax or pay less than you owe, you may face fines or penalties from the IRS, just like with other taxes.
There is no evidence or official guidance that says these tax penalties will affect your immigration status or visa applications.
Other OBBB Provisions That Affect H-1B Visa Holders
While the remittance excise tax itself does not impact your visa status, the One Big Beautiful Bill Act includes other changes that do affect non-citizens, including H-1B visa holders. It’s important to understand these changes so you can plan ahead.
Key OBBB changes for H-1B visa holders:
1. Healthcare Premium Tax Credit Restrictions
- Only U.S. citizens, lawful permanent residents (green card holders), certain Cuban immigrants, and citizens of Compact of Free Association nations can get premium tax credits for health insurance.
- Most H-1B visa holders are excluded from these credits, which means you may have to pay more for health insurance.
2. Fee Increases and New Fees
- The OBBB raises fees for many immigration applications and renewals.
- This includes new “visa integrity fees” and higher fees for renewing work permits (Employment Authorization Documents, or EADs).
- If you need to renew your H-1B visa or apply for related benefits, you may have to pay more.
3. Limitations on Federal Benefits
- The bill limits access to programs like Medicaid, CHIP (Children’s Health Insurance Program), and SNAP (food stamps) for many non-citizens.
- While this does not directly affect your visa, it could impact your family’s access to health care or food assistance.
4. No Fee Waivers
- The OBBB eliminates fee waivers for immigration applications.
- This means everyone, including H-1B visa holders, must pay the full amount for applications and renewals.
Takeaway: While the remittance excise tax does not affect your visa status, these other changes could make it more expensive and harder to maintain your legal status or access benefits.
Why Was the Remittance Excise Tax Created?
The remittance excise tax was introduced as part of a larger effort to raise money for federal programs by taxing non-citizens and immigrants. Lawmakers argued that this tax would help fund important services in the United States 🇺🇸. However, many people believe the tax is unfair because it targets immigrants who often send money home to support family members in countries where jobs and wages are much lower.
Critics of the tax say:
– It puts extra financial pressure on immigrant workers, especially those with low wages.
– It may push people to use informal or illegal ways to send money, which can be risky.
– It could hurt families in other countries who depend on money sent from the United States 🇺🇸.
Supporters of the tax say:
– It is a way to raise money for U.S. programs without increasing taxes on citizens.
– It encourages people to become U.S. citizens to avoid the tax.
What Do Experts and Stakeholders Say?
Immigration advocates warn that the remittance excise tax will hit immigrant workers hardest, especially those who earn less money and send a large part of their income home. They worry that the tax will make life harder for these families and may even cause some people to stop using legal ways to send money.
Tax attorneys and government relations experts are watching how the tax will be put into practice. They have not found any evidence that failing to pay the tax will affect immigration status or visa renewals. They see the tax as a way to raise money, not as a tool for immigration enforcement.
Employers who sponsor H-1B workers should know about the new fees and restrictions in the OBBB but do not need to worry about the remittance tax affecting their ability to sponsor workers.
As reported by VisaVerge.com, the remittance excise tax is mainly a financial rule, not an immigration rule. The main risk for H-1B visa holders is paying extra money in taxes and fees, not losing their visa or job.
What Should H-1B Visa Holders and Employers Do?
If you are an H-1B visa holder or an employer who sponsors H-1B workers, here are some practical steps to take:
For H-1B visa holders:
– Be aware that starting in 2026, you will pay a 3.5% tax on money you send abroad.
– Make sure the tax is paid when you send money, to avoid fines or penalties.
– Keep records of your transfers and any taxes paid, in case you need to show proof.
– Understand that this tax does not affect your visa status, but other OBBB changes may increase your costs.
For employers:
– Inform your H-1B employees about the new tax and other OBBB changes.
– Plan for higher fees when sponsoring or renewing visas.
– Check official resources for updates on immigration fees and requirements.
If you have questions about your specific situation, it’s a good idea to talk to a tax professional or an immigration lawyer. You can also find official information about H-1B visas and related forms on the USCIS H-1B page.
What Happens If You Don’t Pay the Remittance Excise Tax?
If you do not pay the remittance excise tax, or if you pay less than you owe, you may face penalties or fines from the IRS. These are similar to penalties for not paying other taxes. However, these penalties are financial only—they do not affect your immigration status or your ability to renew your H-1B visa.
What you need to know:
– The IRS can charge you extra money if you underpay or avoid the tax.
– There is no rule in the OBBB that connects these tax penalties to immigration enforcement.
– You will not lose your visa or job because of remittance tax issues, as long as you follow other immigration rules.
Looking Ahead: Future Developments and What to Watch For
The remittance excise tax will start with transfers made after December 31, 2025. The U.S. Treasury and IRS are expected to provide more details about how the tax will be enforced in late 2025 or early 2026. Immigration advocates are likely to keep pushing for changes to reduce the impact on immigrant families.
What could change in the future:
– New rules or amendments could be added to the OBBB to change how the tax works.
– Immigration and tax experts will keep watching for any signs that tax penalties could affect immigration status, but none are expected for now.
– If you are affected by the tax, stay informed by checking official government updates and talking to professionals.
Where to Get More Information
If you need legal or tax advice about the One Big Beautiful Bill Act or the remittance excise tax, you can contact:
– Edward Hild, Government Relations Principal: [email protected]
– Sahel A. Assar, Tax Counsel: [email protected]
For immigration-specific questions, consult an immigration lawyer or check the official USCIS website for updates as the OBBB is put into practice.
Summary and Takeaways
- The remittance excise tax under the One Big Beautiful Bill Act is a 3.5% tax on money sent abroad by non-U.S. citizens, starting for transfers after December 31, 2025.
- Underpaying or not paying the tax may result in financial penalties, but does not affect H-1B visa renewals or employer sponsorship under current law.
- The OBBB includes other changes—like higher fees and benefit restrictions—that do affect H-1B visa holders and other non-citizens.
- Stay informed about your tax and immigration responsibilities, and seek professional advice if you have questions.
- Employers should prepare for higher costs and inform their employees about these changes.
For the latest, most accurate information, always check official government sources and consult with qualified professionals. This will help you avoid surprises and keep your immigration journey on track.
Learn Today
Remittance Excise Tax → A 3.5% tax on money sent abroad by non-U.S. citizens, collected by transfer companies after 2025.
H-1B Visa → A U.S. temporary work visa for foreign professionals in specialty occupations requiring sponsorship.
One Big Beautiful Bill Act → Also called OBBB or H.R. 1, a 2025 law imposing new taxes and changes affecting non-citizens.
Employer Sponsorship → The process by which a U.S. employer supports a non-citizen employee’s visa application or renewal.
Employment Authorization Document → A permit allowing certain non-citizens to work legally in the United States.
This Article in a Nutshell
Starting in 2026, non-U.S. citizens must pay a 3.5% remittance excise tax on money sent abroad, without visa consequences. H-1B workers should plan for increased fees and keep records to avoid penalties. While controversial, this tax funds federal programs and does not impact visa renewals or sponsorships.
— By VisaVerge.com
