The 1% federal tax on money sent abroad with cash took effect on January 1, 2026. Eight months of data from the Banco de México (Banxico) later, remittances to Mexico are slightly higher in dollars, spread over fewer and larger transfers, while a stronger peso has cut what those dollars buy. This post goes through the numbers available on November 2, 2026, what the tax covers, what sending costs and how to keep the 1% off your own transfers. For the practical steps of a transfer, see the Mexico corridor guide; for transfers in general, the international money transfer guide.
What changed for remittances to Mexico in 2026?
In dollars, not much: Banxico's figures show remittances to Mexico up 2.2% from January to August 2026, with fewer transfers, a larger average transfer and a stronger peso.
Families received US$41,802 million in the first eight months of 2026, against US$40,903 million a year earlier. The money came in 102.3 million transfers, 2.2% fewer than in 2025, and the average transfer grew 4.5% to about US$409. The rise follows a weak 2025, when remittances fell 3.9% for the year, so January to August 2026 is still 3.1% below the US$43,136 million of the same months of 2024.
| Month | 2025 (US$ million) | 2026 (US$ million) | Change in value | Change in number of transfers | Average transfer, 2026 |
|---|---|---|---|---|---|
| January | 4,698 | 4,657 | −0.9% | −3.9% | US$396 |
| February | 4,491 | 4,542 | +1.1% | −1.9% | US$390 |
| March | 5,191 | 5,500 | +6.0% | −2.2% | US$412 |
| April | 4,801 | 4,983 | +3.8% | −1.8% | US$404 |
| May | 5,407 | 5,625 | +4.0% | −1.8% | US$405 |
| June | 5,253 | 5,472 | +4.2% | +0.3% | US$422 |
| July | 5,408 | 5,571 | +3.0% | 0.0% | US$426 |
| August | 5,654 | 5,452 | −3.6% | −6.4% | US$412 |
| January to August | 40,903 | 41,802 | +2.2% | −2.2% | US$409 |
The figures are Banxico's revised monthly series as published on November 2, 2026; its monthly press releases give the first estimates, which it later revises. Two patterns run through the year. Every month had a larger average transfer than the same month of 2025, and six of the eight had fewer transfers. A flat fee per transfer gives senders a reason to combine payments, but the data can't show why people send what they send. The latest month was the weakest: Banxico's August release puts the 3.6% fall down to 6.4% fewer transfers, partly offset by a 3.0% larger average.
Which transfers to Mexico does the 1% tax cover?
Only transfers paid for with cash, a money order, a cashier's check or a similar physical instrument; bank-account and US-issued card payments are exempt.
The tax is section 4475 of the Internal Revenue Code, added by the One Big Beautiful Bill Act on July 4, 2025, and it applies to transfers made after December 31, 2025. The rate is 1% of the amount sent, on transfers paid with cash, a money order, a cashier's check or a similar physical instrument (IRS, as of Nov 1, 2026). Transfers funded from a bank or other financial-institution account, or with a US-issued debit or credit card are exempt; for the account exemption, the account has to be at a financial institution covered by the Bank Secrecy Act, the main US anti-money-laundering law. The sender owes the tax and the provider collects it; if the provider doesn't collect it, the statute makes the provider pay.
For money going to Mexico, what counts is how you pay in the US, not how your family receives it. A transfer paid for in cash at a store is taxed even if it lands in a bank account through SPEI, Mexico's real-time payment system, and one paid with a US debit card is not taxed even if your relative collects it in cash. The SPEI guide explains the deposit side.
Treasury and the IRS proposed detailed regulations on April 13, 2026, and they were still not final on November 2, 2026. Under the proposal, the 1% is figured on the amount delivered, including any promotional bonus, but not on the provider's fee. Providers report the tax on Form 720 as IRS No. 155, and Notice 2026-52 extends their relief from deposit penalties until final rules apply. The remittance transfer tax guide covers the instruments the proposal adds, refunds and state charges.
Can Banxico's data show the tax's effect?
Not directly: Banxico sorts remittances by how they arrive in Mexico, and a transfer paid in cash at a US store arrives as an ordinary electronic transfer.
From January to August 2026, 99.1% of the money, US$41,447 million, came as electronic transfers. Money brought in person, which Banxico records as cash and kind using estimates from INEGI's surveys of international travelers, was 0.7%, and money orders were 0.2%. None of those categories says whether a sender paid at a counter in cash or in an app with a debit card.
Money orders are the one category the tax names directly, and they did shrink. Banxico counted about 65,400 money orders to Mexico from January to August 2026, 20% fewer than a year earlier, and their value fell 14% to US$78 million. At 0.2% of the flow, though, they say little about the whole.
The best available guide to how many senders are exposed comes from the Treasury's own analysis. In the proposed regulations, it estimated, from data before the tax began, that 30 to 36% of remittances sent through money transfer companies across the US were paid in cash. It didn't break that down by country.
How has the peso changed what families receive?
For families, the exchange rate mattered more than the tax: dollar remittances rose 2.2% through August, but by our estimate they bought about 9% fewer pesos.
The peso strengthened through 2025 and most of 2026. Banxico's FIX, the benchmark rate it sets every banking day, averaged 19.62 pesos per dollar from January to August 2025 and 17.41 over the same months of 2026. Multiplying each month's dollar total by that month's average FIX, remittances were worth about MXN 728 billion from January to August 2026, against about MXN 802 billion a year earlier. Banxico itself reports remittances only in dollars, so the peso figures are an estimate.
The trend turned in September. The FIX hit its 2026 low of 16.87 pesos on September 4, then rose to 18.07 by September 30 and 18.80 on October 30, back near its level of a year earlier. A dollar sent in late October bought about 11% more pesos than one sent in early September.
Worked example: What $410 bought in pesos, at three FIX rates
The average transfer to Mexico in 2026 has been close to $410. Before any fees:
- At the August 2025 average FIX of 18.7063: $410 × 18.7063 = MXN 7,669.58
- At the August 2026 average of 17.0664: $410 × 17.0664 = MXN 6,997.22, which is MXN 672.36 less, or about $39 at that rate
- At the October 30, 2026 FIX of 18.7962: $410 × 18.7962 = MXN 7,706.44
Paying for the same $410 in cash adds $410 × 1% = $4.10 of tax for the sender, a tenth of what the peso's rise took off the August 2026 transfer.
What does it cost to send money to Mexico now?
Fees and exchange-rate margins are shown in the World Bank table below, collected in August 2025 before the tax; if you pay in cash, add 1% on top.
| Amount sent | Average fee | Exchange-rate margin | Total cost (% of amount) | Total cost |
|---|---|---|---|---|
| $200 | $6.51 | 1.28% | 4.54% | $9.07 |
| $500 | $9.83 | 1.02% | 2.99% | $14.94 |
The World Bank's Remittance Prices Worldwide survey, the standard reference for these costs, gathered its latest US-to-Mexico quotes from August 4 to 28, 2025, and it hadn't published a newer round for the route by November 2, 2026. Its averages leave out the tax, which providers only began collecting in January.
The tax weighs more on a cheap route. In its analysis of the proposed rules, the Treasury estimated that the 1% raises the total cost of a typical taxable transfer from the US by 18 to 26%, using World Bank averages for $200 and $500 transfers. Sending to Mexico costs less than the average route from the US, so the same 1% is a bigger share of what a Mexico transfer costs.
Worked example: A $300 transfer to Mexico, by card and in cash
Take a hypothetical provider charging a $3.99 fee and a 1% exchange-rate margin, worth $3.00 on $300.
- Paid with a US debit card: $3.99 + $3.00 = $6.99, or 2.33% of the amount sent
- Paid in cash at an agent: $6.99 + $3.00 of tax = $9.99, or 3.33%
- The tax raises the total cost by $3.00 ÷ $6.99, about 43%
Comparing quotes means comparing the pesos that arrive. The guide to exchange-rate markups shows how to turn a quoted rate into a percentage, and the mid-market exchange rate explains the benchmark. Banxico's FIX, published each banking day, is a free yardstick for peso quotes.
How do you keep the 1% off a transfer to Mexico?
Pay the provider from a US bank or credit union account, or with a US-issued debit or credit card, instead of cash, a money order or a cashier's check.
Sending to Mexico without the 1% tax
- Fund online and app transfers from a checking account or a US-issued card
- At a store or agent counter, ask whether you can pay by debit card; the tax follows the payment method, not the location
- Check the receipt, which lists any taxes the provider collects, and query a 1% charge on a transfer you paid by card
- Choose the payout your family prefers, a SPEI deposit to their CLABE or cash pickup, since neither changes the tax
- Compare the quoted rate with Banxico's FIX or the mid-market rate before you pay
- Keep receipts, which also help if a transfer is canceled and you need to claim back tax
Paying by card still leaves the provider's fee and exchange-rate margin, which usually cost more than the tax, so the provider's price matters more than the payment method once you're off cash. The Mexico corridor guide compares SPEI deposits with cash pickup and lists the details your family needs, the money transfer cost calculator prices any quote, and your rights when you send money abroad covers errors and cancellations.
What to watch for the rest of 2026
Banxico publishes its monthly remittance figures on the first banking day of each month at 9:00 a.m. Mexico City time. November 2 is a bank holiday in Mexico, so September's figures are due on Tuesday, November 3, and the full-year 2026 total in early February 2027.
The IRS rules could change before they're final. As proposed, the final regulations would apply from the first calendar quarter that starts on or after their publication, and until then providers and senders may rely on the proposal if they follow all of it. The first World Bank price survey taken after January 2026 will be the first official reading of what the tax has done to costs on the route.
December is the other date to plan around. Mexican banks close on Friday, December 25 and on weekends, and US wire and ACH settlement pauses over Christmas and New Year; when to send money for the holidays lists the cut-off dates.