Bill
Bill > HF2168
IA HF2168
IA HF2168A bill for an act creating a state remittance tax and including applicability provisions.
summary
Introduced
01/27/2026
01/27/2026
In Committee
01/27/2026
01/27/2026
Crossed Over
Passed
Dead
Introduced Session
91st General Assembly
Bill Summary
This bill creates a remittance transfer tax at a rate of 50 percent on the gross remittance transfer amount made by a sender in this state. The bill defines “remittance transfer” based upon the federal definition in 15 U.S.C. §1693o-1(g), which generally defines remittance transfer to mean an electronic transfer of funds by a sender to a recipient, whether or not the sender holds an account with the remittance transfer provider. The bill defines “remittance provider” to mean any person or financial institution that provides remittance transfers for a consumer in the normal course of business, whether or not the consumer holds an account with such a person or financial institution. The tax imposed under the bill only applies to remittance transfers where the sender provides cash, a money order, a cashier’s check, or any other similar physical instrument to the remittance transfer provider to initiate the transfer to the recipient. The tax shall not be imposed on any remittance transfer for which the funds being transferred are withdrawn from an account held in or by a financial institution. The bill specifies the tax shall be paid by the sender of the remittance transfer. The remittance transfer provider is required to collect the tax and to transfer the tax to the department of revenue on a monthly basis. If the remittance tax is not collected at the time of the remittance transfer, the bill requires the remittance provider to pay the tax. The bill requires the director of revenue to administer the remittance transfer tax as nearly as possible in conjunction with the administration of the state sales and use tax law, except that portion of the law that implements the streamlined sales and use tax agreement. The bill directs all revenues derived from the remittance transfer tax to be deposited into the general fund of the state. The tax applies to remittance transfers occurring on or after July 1, 2026.
AI Summary
This bill establishes a new state remittance transfer tax of 50 percent on the total amount of money sent through a remittance transfer, which is defined similarly to the federal definition as an electronic transfer of funds from a sender to a recipient, regardless of whether the sender has an account with the provider. A "remittance provider" is any business or financial institution that offers these transfers. This tax specifically applies only when the sender uses cash, a money order, a cashier's check, or a similar physical item to initiate the transfer, and it does not apply if the funds are withdrawn from a financial account. The sender is responsible for paying the tax, but the remittance provider must collect it and send it to the department of revenue monthly; if the provider fails to collect it, they are liable for the tax. The director of revenue will manage this tax similarly to state sales and use taxes, excluding provisions related to the streamlined sales and use tax agreement, and all collected revenue will go into the state's general fund. This new tax will take effect for remittance transfers made on or after July 1, 2026.
Committee Categories
Business and Industry
Sponsors (1)
Last Action
Introduced, referred to Commerce. H.J. 156. (on 01/27/2026)
Official Document
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://www.legis.iowa.gov/legislation/BillBook?ga=91&ba=HF2168 |
| BillText | https://www.legis.iowa.gov/docs/publications/LGI/91/attachments/HF2168.html |
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