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Every year, millions of families receive money sent from the United States, and the question always arises: is there a tax cost for this? Does it need to be declared? The short answer is no; in most cases, family remittances do not pay taxes, neither in the country of origin nor in the destination country. But there are important conditions that are worth understanding.
Family remittances sent between direct relatives are exempt from Income Tax in Mexico under Article 93 of the Income Tax Law (Ley del ISR), provided they do not exceed the annual limit established in that same law. In the United States, as of January 2026, a 1% tax applies to cash remittances sent, although payments made with a debit card or bank account are exempt.
Do remittances pay taxes in the United States?
Since January 1, 2026, there has been a 1% excise tax on cash remittances sent from the U.S. abroad, approved through the One Big Beautiful Bill Act. The tax is paid by the person sending the money, not the person receiving it. However, transfers made with a debit or credit card issued by a U.S. financial institution, or via bank transfer from a U.S. account, are exempt. To understand in detail how this tax works and how to avoid it, see: 1% tax on remittances in 2026: what it is and how it affects you.
In addition to this tax, there is a reporting obligation, not an additional tax. Under the Bank Secrecy Act (BSA), financial institutions and money transfer operators must report to FinCEN (the U.S. Department of the Treasury's financial intelligence unit) any cash transaction exceeding $10,000. This also applies when someone intentionally splits transfers to stay below that threshold, a practice known as "structuring," which is prohibited.
Reporting a transfer to FinCEN is not paying a tax: it is an anti-money laundering mechanism that applies to any large cash movement, regardless of its origin or destination.
Félix is registered with FinCEN as a Money Services Business, which means it complies with these rules and generates a clear record of every transaction. That record can be useful if you ever need to document your transfer history.
Are remittances taxed in Mexico?
In Mexico, the answer is also mostly no. Article 93 of the Income Tax Law exempts remittances from income tax if they come from a direct relative (spouse, father, mother, son, or daughter), provided the total amount received in the year does not exceed 400 times the current daily general minimum wage. If the remittance comes from someone who is not a direct relative, or exceeds that limit, the SAT may treat it as taxable income.
To understand the Mexican legal framework in detail, the exact thresholds, and when you must document the relationship, see: What are the taxes for receiving money from abroad?
What to do to keep your remittances exempt (and how Félix helps you)
Complying with the conditions of Article 93 is not complicated, but it does require a couple of basic habits.
Use a regulated service that generates clear records
Félix operates under federal regulation in the United States and generates a receipt for every transfer. That means both the sender and the recipient have access to a documented history: date, amount, and exchange rate applied. If the SAT or any authority asks, that documentation is your backup.
Know the family relationship that applies to the exemption
The income tax exemption applies between direct relatives. If you send money to a sibling, an uncle, or a friend, the tax situation may be different. It does not mean you must pay tax automatically, but it no longer falls into the same category of direct family donation protected by Article 93.
Keep a record of annual amounts
The exemption limit is relative to the daily minimum wage of the current year. If the accumulated transfers in a year approach a considerable amount, it is worth it for the beneficiary to consult an accountant to know if they are within the exempt range or if they need to declare it.
Frequently asked questions
Do I have to include remittances in my annual tax return in Mexico?
If the remittances come from a direct relative and the total amount for the year does not exceed the limit established in Article 93 of the Income Tax Law, you have no obligation to declare them. If the amount exceeds that limit or the remittance does not come from a direct relative, it is advisable to consult with an accountant to see if any reporting obligation applies.
What happens if I receive remittances from an employer instead of a family member?
If the money comes from a company or employer abroad (for example, as payment for services or a salary), it is not classified as a family gift. In that case, the SAT may treat it as employment income, and income tax (ISR) may apply. The distinction between a family remittance and a work payment is key.
Does the person sending money from the U.S. have to declare anything on their tax return?
As of January 2026, anyone sending cash remittances from the U.S. must pay a 1% excise tax on the amount sent. This is not an additional declaration on the tax return, but rather a cost at the time of transfer. Payments made with a U.S. debit card or bank account are exempt. Beyond this, sending money abroad does not trigger additional tax events for the sender on their annual return.
Sources and references
Mexican tax legislation
United States financial regulation
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