Laura Snyder (Association of Americans Resident Overseas), OBBBA: Remittance Tax Goes From Highly Problematic to Barely There, 188 Tax Notes Fed. 31 (July 7, 2025):

The various versions of One Big Beautiful Bill contained a tax on remittance transfers. This article compares the different versions of the tax as it was modified in each version of the bill. If it had been adopted, the House version of the bill would have been highly problematic for overseas Americans, among many others. The final version as contained in the bill signed into law on July 4, 2025 was dramatically scaled back as compared to the House version, but still victimizes the undocumented and the unbanked. It especially victimizes the intended recipients of remittance transfers — the poorest of the poor.

Conclusion
The House version of the remittance tax is highly problematic for overseas Americans. They would, presumably, be unintended victims. The House version is also, of course, highly problematic for its intended victims: While Smith described those victims as “illegal immigrants,” in reality, the House version deliberately targets anyone who is not a U.S. citizen or national, regardless of their immigration status. While many overseas Americans would likely be on the hook for the tax under the House version, all who are not U.S. citizens or nationals definitely would be.

The Senate version of the remittance tax is an improvement over the House version. It would not violate the 14th Amendment’s equal protection guarantees in the clear manner that the House version would, it would spare financial institutions the expense and risk of having to
verify senders’ citizenship status, and it would not penalize senders for being married to a nonresident alien.

But the Senate version remains problematic. It is, like the House version, at best ambiguous regarding the refundability of the remittance tax. And overseas Americans unable to maintain a U.S. bank account would be obliged to pay the tax, with potentially no way to recover it in the form of an income tax credit.

Again, overseas Americans would, likely, be unintended victims of the House version. They would fare considerably better under the Senate version. The intended victims of both versions — persons who are undocumented, poor, and unbanked — would fare badly under each. If they did dare to try to assist their families and communities in their countries of origin, they would be punished with double taxation — once in the form of income tax, and again in the form of a remittance tax.

The ultimate victims would be the intended recipients of remittances — the poorest of the poor.52 Under either the House or the Senate version, the remittance tax would take food out of the mouths of babes.

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