Summary
The IRS announced that certain financial institutions will get a grace period from penalties for not correctly depositing a new tax on international money transfers. The new tax, which starts on January 1, 2026, requires a 1% charge on certain money transfers sent abroad. The relief period will last until the end of the third quarter of 2026 to help companies adjust.
Key Facts
- The IRS is providing a grace period for penalties related to the new remittance transfer tax.
- The remittance transfer tax requires a 1% fee on certain international money transfers starting January 1, 2026.
- Financial institutions must make deposits twice a month and file quarterly returns.
- The first tax deposit is due on January 29, 2026.
- The penalty relief covers the first three quarters of 2026.
- Companies can avoid penalties if they pay the full amount by the due date, even if calculations were incorrect.
- The relief aims to help businesses adjust to the new law while maintaining compliance.
