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The IRS announced a transition period with deposit penalty relief Notice 2025-55, to the new remittance tax created by the One Big Beautiful Bill Act.
Beginning Jan. 1, 2026, remittance transfer providers are required to collect a 1% remittance transfer tax from certain senders, make semimonthly deposits, and file quarterly returns with the IRS. The law imposes a penalty for any person’s failure to make timely deposits, unless the failure is due to reasonable cause and not willful neglect. However, the IRS said in its Oct. 7 notice that it will allow a three-quarter partial safe harbor period to remittance payment providers responsible for collecting and transferring the tax, allowing providers to avoid penalties if they make good faith compliance efforts outlined in the notice.
Due to possible challenges in implementing the new law, Notice 2025-55 enables providers to avoid deposit penalties if they:
- Make timely deposits, even if they are incorrectly calculated, and
- Ultimately pay the full amount of any underpayment by the due date of Form 270, Quarterly Federal Excise Tax, for the quarter.
The IRS says it will treat the first calendar quarter of 2026 as the look-back quarter for purposes of the deposit safe harbor and to determine the semimonthly deposits during the third calendar quarter of 2026.
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