The 1% Remittance Tax Is Coming in 2026, But OAPay Users Stay in the Clear

As millions of African families rely on remittances from abroad to meet daily needs, a new U.S. rule is sparking concern across the diaspora and recipient communities alike. Starting in 2026, certain money transfers will carry a 1% remittance tax introduced by the federal government.

The rollout has left African expats in the US uneasy, with growing fears that this added cost will reduce the money their loved ones receive each month.

For many, sending money home is not optional. It helps with school fees, rent, and medical bills. So, when a new tax enters the picture, the worry is real. For cross-border families, this feels like more than a small fee.

But here’s the good news. This tax does not apply to anyone sending money through OAPay. Yes, you read that correctly. With OAPay, your transfers remain free from this additional charge, ensuring more of your money reaches your loved ones.

OAPay, the trusted remittance provider for African senders in the US and the UK, uses a fully digital system and regulated payment methods that are not subject to the tax in the new law.

Since the tax applies to physical instruments, not regulated digital remittance providers, OAPay users can transfer money internationally without fees tied to this law. We will explain this in detail in a moment. First, here is what we will cover in this article:

• What the new remittance tax means
• Why lawmakers introduced it
• Who is covered under the rule
• How OAPay shields you from the tax

What exactly is the US remittance tax?

On July 4 of this year, US President Donald Trump approved the One Big Beautiful Bill, adding a 1% tax on certain outbound transfers. The rule begins on January 1, 2026, and affects how people send money from the US. 

This tax is applied to transfers funded through cash, money orders, or cashier’s checks. These paper-based methods fall under the new rule, while digital transfers financed through a bank account or a licensed remittance provider do not fall into this category.

For those who transfer money internationally, the impact depends on the tool used to send money. A digital remittance provider like OAPay is not part of the taxable group.

Why did the US introduce this tax?

The remittance tax was brought in to create a stronger overview on money leaving the country. Cash-funded transfers leave limited documentation, making them harder to track.

Policy researchers believe this new rule marks a shift toward digital channels and away from cash-funded activity. The tax also follows long debates about cross-border money flows, tax fairness, and concerns linked to money laundering. 

Who is affected (and who isn’t)?

The 1% remittance tax applies to anyone sending money abroad from the US if the transfer is funded with cash, a money order, a cashier’s check, or other paper instruments.

Who pays?

• Anyone sending money abroad from the US, including non-citizens
• The sender pays the tax, not the recipient

When is it applicable?

• Applies only to in-person, cash-based transfers
• Money entering the US is not taxed

How is it collected?

• The remittance service collects the tax and sends it to the IRS

OAPay’s advantage: 0% exposure to the tax

As OAPay works through fully digital funding methods, the new 1% charge does not apply to its users. The platform does not handle cash, money orders, or cashier’s checks, which are the only payment methods covered by the rule.

This structure keeps senders clear of extra charges tied to cash transfer services to Africa. With OAPay, individuals and businesses in the US can send money through a bank transfer or card payment, both of which fall outside the scope of the tax.

OAPay is also the top choice for the African diaspora, as it offers fair exchange rates and fast transfers. There are no hidden charges, no surprise deductions, and no commission on transfers.

That means the full amount reaches your loved ones without cuts. It’s a simple way to support the people you care about while keeping your costs steady.

Protecting every dollar you send

OAPay keeps your transfers clear of the new tax, giving you one less thing to worry about. Digital payments stay free of added charges, and your full amount reaches home without cuts.

Supporting loved ones back home remains convenient when you use a secure and regulated digital money transfer service like OAPay. The platform comes loaded with functionalities and financial tools built for everyday needs.

Keep your transfers steady and stress-free. Sign up on OAPay and send money without added fees.

FAQs:

1. When does the 1% remittance tax start?
The new charge applies to qualifying outbound transfers made on or after January 1, 2026.

2. Who has to pay this tax?
Anyone sending money abroad from the US with cash or similar paper tools pays the tax.

3. Does the 1% US remittance tax apply to OAPay users?
No, OAPay users stay outside the tax because all transfers run through electronic payment rails.