Remittance Cost Calculator
The amount, both exchange rates, and how you are funding it
Your result will appear here
Fill in the fields on the left and this updates as you type.
Know what this estimate is based on
- Jurisdiction
- General mathematical model
- Scope and limitations
- Planning indicator only. It does not assess every part of a household's finances or replace individualized professional advice.
- Source links checked
- Jul 30, 2026
Built and regression-tested by Smart Tools Lab. It has not been individually reviewed by a licensed financial, tax, or legal professional.
How to use
- 01
Enter the dollar amount you are sending. Everything else on the page is a percentage of it, so this is the number the whole comparison turns on.
- 02
Enter the provider's stated transfer fee — the figure it advertises. Expect this to turn out to be the smaller half of what the transfer actually costs you.
- 03
Enter the exchange rate the provider is quoting, in units of the recipient's currency per dollar. Take it from the live quote screen rather than from memory; providers re-price through the day.
- 04
Enter the mid-market rate for the same pair — the number Google, Reuters or XE shows with no provider attached. The page derives the margin from the gap between the two rates, which is why it needs both and holds no exchange rate of its own.
- 05
Add how many transfers like this you make in a year to see the annual figure, and leave the statutory block alone: the 1% federal excise, and the World Bank Q3 2025 benchmarks of 6.36% global, 3.29% for the three cheapest services in a corridor, and 9.50% bank against 3.65% digital in the advanced panel.
Formula
Margin = (1 − provider's rate ÷ mid-market rate). A provider quoting a better rate than mid-market gives a negative margin, which the page reports honestly rather than hiding — that happens on promotional first transfers. Margin cost = amount × margin. Excise = amount × 1%, but ONLY on a transfer funded with cash, a money order or a cashier's check. There is no minimum size. Total cost, cash-funded = stated fee + margin cost + excise. Total cost, funded from an account or a US card = stated fee + margin cost. The difference between the two lines is the excise, and nothing else. Recipient receives = amount × the provider's quoted rate. What the mid-market rate would have delivered = amount × mid-market rate; the gap is the shortfall. Annual cost = total cost × transfers a year. Benchmarks are the amount × the World Bank Q3 2025 percentages, so they are directly comparable to your own total cost figure.
Example
Sending $500 to Mexico. The provider advertises a $4.99 fee and quotes 17.2000 pesos to the dollar; the mid-market rate at that moment is 17.5500. The margin is 1 − 17.2000 ÷ 17.5500 = 1.99%, which on $500 is $9.97 — twice the advertised fee, and invisible on the receipt. Fund it from your bank account and the transfer costs $14.96, or 2.99% of what you sent. Hand over cash at a counter instead and the 1% excise adds $5.00, taking it to $19.96, or 3.99%. Either way the recipient gets 8,600.00 pesos, where the mid-market rate would have delivered 8,775.00 — a shortfall of 175.00 pesos. Against the World Bank benchmarks the cash-funded total is $19.96 where the three cheapest services in a corridor would average $16.45 and a bank would take $47.50. At twelve transfers a year that is $239.54 annually funded with cash, $179.54 funded from an account, and $197.40 at the cheapest-three benchmark — so the funding instrument alone is worth $60 a year on this pattern, before you change provider at all.
Definitions
- Mid-market rate
- The midpoint between the buy and sell prices for a currency pair in the wholesale market — the rate Google, Reuters and XE show with no provider attached. Nobody retail actually trades at it; it is the benchmark the margin is measured against.
- Exchange-rate margin
- The gap between the mid-market rate and the rate a provider quotes you, expressed as a percentage. It is a price rather than a fee, so it never appears as a charge on a receipt — and on a typical transfer it costs more than the advertised fee.
- Remittance excise (IRC section 4475)
- A 1% federal tax on remittance transfers made after 31 December 2025, with no minimum transfer size. It reaches cash, money orders and cashier's checks, and exempts transfers funded from a financial-institution account or by a US-issued debit or credit card.
- Funding instrument
- How you paid for the transfer, as opposed to who you are or where it is going. It is the only thing the excise keys on, which is why the same $500 to the same recipient costs two different amounts depending on whether you tapped an app or handed over cash.
- Corridor
- A country-to-country sending route, such as United States to Mexico. The World Bank prices costs by corridor because they differ substantially: the same provider is not equally competitive everywhere.
- Form 720
- The quarterly federal excise tax return on which remittance transfer providers report and remit the 1%. Providers also deposit twice a month, which is why the collection shows up on your receipt even though the liability is yours.
Good to know
Who actually owes the 1%, and who does not
The most useful thing to know about the new remittance excise is that it probably does not apply to you. Internal Revenue Code section 4475, enacted by the One Big Beautiful Bill Act and effective for transfers made after 31 December 2025, imposes 1% on remittance transfers — but it reaches only transfers funded with cash, a money order, a cashier's check or a similar physical instrument. It expressly exempts a transfer funded by withdrawal from an account at a financial institution, and a transfer paid for with a debit or credit card issued in the United States. That exemption covers the overwhelming majority of how money actually moves: if you send from an app tied to your checking account, or type a card number into a provider's website, no excise is due. The tax lands on the person handing cash across a counter at a storefront agent. It is worth being precise about the test, because the coverage in 2025 was not. It keys on the funding instrument and nothing else. Not on citizenship, not on immigration status, not on the destination country, not on the size of the transfer — and there is no de minimis floor whatsoever, so a $50 transfer is taxed on the full $50, which is fifty cents. The rate itself moved twice during the legislative process, appearing at 5% in the first House version and 3.5% in a later one before landing at 1%, so any figure from mid-2025 reporting is simply out of date. Liability sits with the sender and collection sits with the provider, which deposits twice a month and files quarterly on Form 720; if a provider fails to collect where it should have, the tax becomes the provider's own liability, which is why some collect defensively. IRS Notice 2025-55 granted limited relief from the failure-to-deposit penalty for the first three quarters of 2026 while systems caught up. None of that changes what you owe. It does explain why one receipt shows the excise as its own line and another folds it silently into the fee. The practical conclusion is short: if you are paying cash and you have a bank account or a US card, changing how you fund the transfer removes the tax entirely.
The cost nobody shows you
A money transfer has two prices and only one of them is advertised. The stated fee is a number on a screen. The exchange-rate margin is the gap between the mid-market rate — the wholesale midpoint that Google, Reuters and XE display with no provider attached — and the rate the provider is actually quoting you. It never appears as a charge on a receipt because it is not a charge; it is a price. That is precisely what makes it effective. Two providers can advertise the same $4.99 fee and deliver materially different amounts to the same recipient, because one is quoting 0.4% off mid-market and the other 3%. On a $500 transfer at a 1.99% margin, the invisible cost is $9.97 against a visible fee of $4.99: twice as much of what you paid is in the number nobody put in front of you. The ordering gets worse as the amount grows, because the fee is usually flat while the margin is a percentage — which is why a pair of quotes that favours one provider at $200 can favour the other at $2,000, and why comparing on the advertised fee alone is close to useless. This page therefore asks for both rates rather than for the margin, and derives the gap itself. That is not a workaround for a missing exchange rate feed, though it is true that this site holds none and never will: a stored rate goes stale within the hour and a calculator quoting one would quietly mis-state the only number here worth having. It is that asking a person for their margin asks for something nobody knows, while asking for two rates asks for two figures already on screen in front of them. The practical technique follows from the arithmetic. Never compare fees. Open both providers' quote screens and a mid-market source at the same moment, and compare the amount that lands in the recipient's hands — that single figure nets the fee, the margin and, where it applies, the excise into one number that cannot be dressed up.
What the world pays, and where the difference lives
The World Bank has priced this market quarterly since 2008 through Remittance Prices Worldwide, and its figures are the only credible benchmark a consumer can hold a quote against. In the third quarter of 2025 — the most recent issue published, which is why every figure on this page carries its date rather than pretending to be current — the global average cost of sending $200 was 6.36%. The average of the three cheapest qualifying services in each corridor was 3.29%. That gap, between what the market charges on average and what the cheapest services in the very same corridor charge, is the entire consumer opportunity: it is available without moving countries, changing banks or sending a different amount. The wider split is by channel rather than by corridor. Banks averaged 9.50% and digital providers 3.65% for the same money going to the same place, so the decision about which kind of institution to use is worth roughly two and a half times as much as fine-tuning between two providers of the same kind. Corridors do differ, and the variation is real: Sub-Saharan Africa averaged 8.78% while South Asia averaged 5.18%, a spread that reflects competition, regulation, currency liquidity and cash-out infrastructure rather than distance. Against that background the international policy target — United Nations Sustainable Development Goal 10.c, which asks for remittance costs below 3% by 2030 — is a useful yardstick for how far the market still has to travel: the cheapest services in a typical corridor are only just approaching it, and the average is more than double it. What all of this means for a person sending money home every month is that the benchmark row on this page is not decoration. If your total is landing near 6% you are paying the world average, which is roughly twice what the cheapest services in your own corridor charge — and at twelve transfers a year that difference compounds into real money on funds that are, by definition, already spoken for at the other end.
Sending it well
Four habits do most of the work. First, fix the funding instrument, because it is free to change and worth 1% immediately: if you are paying cash at a counter and you have a bank account or a US-issued card, moving the funding removes the excise entirely. That is the largest single-step saving available to most senders and it requires nothing but a different tap. Second, compare on the delivered amount rather than on the fee. Every provider will show you what the recipient receives before you commit; that number nets the fee, the margin and the tax together and cannot be presented flatteringly. Do it at the same moment for both providers, because rates move through the day and a comparison built from two screenshots an hour apart measures the market rather than the providers. Third, treat a strikingly good rate as a promotion until proved otherwise. A provider quoting at or better than mid-market on a first transfer is common practice and reverts afterwards, which is why this page reports a negative margin honestly rather than clamping it — and why the comparison is worth re-running rather than assuming last quarter's winner still wins. Fourth, watch the shape of your sending rather than each individual transfer. Fees are usually flat and margins are usually percentages, so many small transfers pay the fee many times while one large transfer pays the margin on everything at once; the crossover between those two costs is specific to your amounts, and the annual figure on this page is where it becomes visible. Two smaller things worth knowing. Speed is usually priced separately, and paying for an express payout on money that is not needed today is the easiest avoidable cost in the whole transaction. And keep the receipts, particularly through 2026 while providers settle into collecting the excise consistently — a line labelled differently on two receipts from the same provider is a reporting artefact rather than a change in what you owe, but it is much easier to establish that with the paperwork in hand.
Frequently asked questions
Do I have to pay the new 1% remittance tax?
Probably not. The excise under Internal Revenue Code section 4475 reaches transfers funded with cash, a money order, a cashier's check or a similar physical instrument. It expressly does not reach a transfer funded by withdrawal from an account at a financial institution, or paid for with a debit or credit card issued in the United States — and that is how most people send money. If you tap your bank account in an app, or pay by card, the 1% does not apply to you. If you hand cash across a counter at a storefront agent, it does. The page computes both totals side by side precisely because that one difference is often the largest single saving available on the transfer.
What exactly counts as cash-funded?
The test is the funding instrument, not who you are or where the money goes. Cash handed to an agent, a money order and a cashier's check are all inside the tax. A transfer debited from a checking or savings account at a bank or credit union is outside it, as is one paid for with a US-issued debit or credit card. Nothing about citizenship, immigration status or the destination country changes the answer — the statute keys on the instrument alone. In practice that means the tax falls hardest on people paying cash at a counter, who were already paying the most for the transfer itself.
Is there a minimum transfer before the tax applies?
No, and this is the part that surprises people. There is no de minimis floor at all: a $50 transfer is taxed on the full $50, which is 50 cents, and a $5,000 transfer is taxed on the full $5,000. The rate went through two much larger proposals during 2025 — 5% in the first House version, then 3.5% — before landing at 1% in the enacted law, so any figure you read in mid-2025 coverage is obsolete. It applies to transfers made after 31 December 2025, which means the whole of 2026.
Why does this page ask for two exchange rates?
Because the gap between them is the answer. This site holds no exchange rate feed and never will: a stored rate goes stale within the hour, and a calculator quoting one would mis-state the single number here worth having. So you supply both — what your provider is quoting, and what the mid-market rate is for the same pair right now — and the page derives the margin from the difference. That is also exactly how a person compares two providers in real life: open both quote screens and a mid-market source, and read off which one is closer. Asking you for your margin directly, as most tools do, asks for a number nobody knows.
What is the exchange-rate margin and why is it not on my receipt?
It is the provider's cut, taken by quoting you a rate slightly worse than the one it can trade at. It never appears as a charge because it is not a charge — it is a price. That is what makes it effective: two providers can advertise the same $4.99 fee and deliver very different amounts, because one is quoting a rate 0.4% off mid-market and the other 3%. On the $500 example below, a stated fee of $4.99 sits beside $9.97 of margin, so twice as much of the cost is in the number nobody shows you. As the amount grows the ordering gets worse, because the fee is usually flat while the margin is a percentage.
Why does the table show a cheaper channel delivering less than mine?
Because the two kinds of row are built from different information, and it is worth knowing which is which. Your own two rows convert the full amount at the rate your provider quoted, because that is a real rate you gave the page. The four benchmark rows have no quoted rate — the World Bank publishes a total cost percentage, not a rate — so they take that cost off the principal and convert what is left at the mid-market rate you entered. In the worked example the 3.29% benchmark row shows 8,486.30 while your own row shows 8,600.00, even though the benchmark is cheaper. Compare the Total cost column instead, which is like-for-like: $19.96 against $16.45.
What should a transfer actually cost?
The World Bank's Remittance Prices Worldwide put the global average cost of sending $200 at 6.36% in the third quarter of 2025, and the average of the three cheapest qualifying services in each corridor at 3.29%. The gap between channels is wider than the gap between corridors: banks averaged 9.50% and digital providers 3.65% for the same money. If your total is landing near 6% you are paying the world average, which is roughly twice what the cheapest services in your own corridor charge — and the fix is almost always the channel rather than the provider's advertised fee.
Who is liable for the tax — me or the provider?
You are; the provider collects it. Remittance transfer providers deposit the tax twice a month and file quarterly on Form 720, and IRS Notice 2025-55 gave limited relief from the failure-to-deposit penalty for the first three quarters of 2026 while systems caught up. If a provider fails to collect when it should have, the tax becomes the provider's own liability — which is why some will collect defensively. None of that changes what you owe, but it does explain why one receipt itemises the excise as its own line and another quietly folds it into the fee.