New Rules for H-1B & F-1 Visa Holders: What You Need to Know

A 3.5% tax on money sent abroad & new visa fees - here’s a clear breakdown.

Author

Amanda Binu
July 11, 2025

Hey there!

If you’re on an H-1B, F-1, or any temporary visa in the U.S. and regularly send money to family back home—this is an update you’ll want to know.

On July 4, 2025, President Trump signed into law the “One Big Beautiful Bill Act,” a wide-ranging piece of legislation with several provisions affecting immigrants, including a new 3.5% tax on international remittance transfers.

Let’s break it down.

What’s Changing?

One of the headline changes is a new 3.5% excise tax on money sent from the U.S. to other countries - what’s commonly known as a remittance tax.

This means that every time money is transferred abroad using a wire service, bank, or transfer app, a 3.5% tax could be added to the transaction.

Originally proposed at 5%, the rate was reduced to 3.5% before the bill passed the House.

Who Could Be Affected?

This provision is likely to impact:

  • H-1B visa holders who send money to family back home

  • F-1 students supporting dependents or managing finances internationally

  • Green card holders and other visa holders

  • NRIs (Non-Resident Indians) and immigrant workers

  • Anyone using services like Wise, Western Union, or traditional bank wires for international transfers

U.S. citizens and nationals are generally not subject to this tax. The law specifically applies to non-citizens, including most temporary visa holders.

Not on OPT/STEM OPT or H-1B Visa? Fill out this quick survey so we can send you tailored content based on where you’re at in your international student journey.

When Does It Take Effect?

If you’re sending money now - no immediate change. The tax is set to begin on:

→ January 1, 2026

That means the next 6 months are key for understanding your options, adjusting financial plans, considering larger, less frequent transfers or consulting a tax advisor if you frequently send funds abroad.

What’s the Status of the Bill?

The bill is now law. Here's how it happened:

  • July 1, 2025 – Senate passed the bill

  • July 3, 2025 – House passed the identical version

  • July 4, 2025 – President signed it into law

Although signed, many provisions - including this tax - require federal agencies (like the IRS and Treasury Department) to issue rules and guidance before enforcement begins. This includes how the tax will be collected, exemptions (if any), and compliance procedures for banks and money transfer services.

Why It Matters

India received $129 billion in remittances in 2024, with $36 billion coming from the U.S. alone. That’s over $1.25 billion in new potential taxes from Indian-origin workers and students sending funds back home.

If you’re someone who regularly sends money abroad to pay off loans, support family, or manage shared expenses, this new tax could impact your financial planning.

Here are some example’s of tax charges applied to transfer amounts:

Amount Sent

Tax Rate

Tax Applied

Total Cost (Amount + Tax)

$100

3.5%

$3.50

$103.50

$500

3.5%

$17.50

$517.50

$1,000

3.5%

$35.00

$1,035.00

$2,000

3.5%

$70.00

$2,070.00

$5,000

3.5%

$175.00

$5,175.00

$10,000

3.5%

$350.00

$10,350.00

How to Calculate:
Multiply the amount you plan to send by 0.035 to get the tax. Add this tax to your original transfer amount to determine the total cost.

Example Calculation:
If you send $1,000:

$1,000×0.035=$35 (tax)$1,000×0.035=$35 (tax)

Total cost = $1,000 + $35 = $1,035

Note:
This tax is in addition to any service fees charged by your bank or money transfer provider.

What Should You Do Now?

While the rule hasn’t taken effect yet, it’s a good time to:

  • Stay informed as updates are released

  • Keep an eye on transfer service fees and notices (some may offer guidance or options)

  • Plan ahead for 2026 if you make regular remittances

What About Visa Fees?

Another key change in the bill is the introduction of a new $250 Visa Integrity Fee.

Here’s what we know so far:

  • It applies to all non-immigrant visa applicants (including F-1, H-1B, and tourist visas)

  • The fee is refundable, but only if you comply with your visa terms (like leaving the U.S. on time)

  • The refund process hasn’t been explained yet and may involve added documentation

This fee is in addition to current visa application costs, so it’s worth factoring into your future plans for renewals, change of status, or re-entry. The visa fee changes are expected to roll out in 2026, with more details to come from agencies like the Department of State and USCIS.

We’ll continue monitoring updates and share additional guidance as the implementation timeline becomes clearer. Whether you're on OPT/ OPT STEM extension, or weighing long-term visa options - every decision depends on staying informed. That’s why our newsletter breaks down complex updates like this one into clear, actionable insights - so you never miss a change that could affect your future. Keep an eye out for the next newsletter coming out next week!

Until then,
The Roam Growth Team 🧡