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Trump’s Big Beautiful Bill explained: What NRIs need to know about remittances, rentals, and property investments
From Jan 1, 2026, Trump’s Big Beautiful Bill adds 1% tax on cash remittances, raising costs for large property transfers, say experts
With US President Donald Trump’s Big Beautiful Bill clearing Congress, many Indian NRIs are now questioning how it will affect their finances, from remittances and rental income to future real estate investments.
1% Remittance Tax on inward remittances
A significant revision to a proposed bill, unveiled on June 27, has drastically reduced the tax rate on remittances from Non-Resident Indians (NRIs) and Indian professionals in the US. The updated draft now stipulates a 1% tax on money sent back to India, a substantial decrease from the initially proposed 5%. This latest amendment further lowers the rate from the 3.5% figure previously seen in the House version of the bill, offering considerable relief to thousands.
The new draft reads, “There is hereby imposed on any remittance transfer a tax equal to 1% of the amount of such transfer.” It also mentions that the sender will be responsible for paying the tax.
“While the 1% remittance fee is modest, it adds a new cost consideration to cross-border cash transfers. Although US bank and card-based remittances remain exempt, NRIs who make high-value or recurrent transfers may need to reconsider their financial plans,” says Ram Naik, co-founder and director, The Guardians Real Estate Advisory.
NRIs who have rental income in India
While this is a huge bill in terms of the volume, there are no changes with respect to the Foreign Account Tax Compliance Act (FATCA) or reporting of Global Assets, which continues to be reportable. As far as rental income and capital gains for taxation is concerned, the bill does not alter the existing U.S. tax treatment of foreign-source rental income earned by U.S. tax residents, including NRIs (Non-Resident Indians) holding a green card or U.S. citizenship.
“Such income will continue to be taxed under current law, with the availability of foreign tax credits for Indian taxes paid pursuant to the U.S.-India Double Taxation Avoidance Agreement (DTAA),” says Sandeep Bhalla, Partner, Dhruva Advisors, a tax and regulatory advisory services firm.
Also Read: 5 things NRIs should keep in mind before investing in property in India
Under existing U.S. tax law, citizens and residents are taxed on their global income, which includes earnings from overseas real estate. This framework remains intact under the current version of the bill. “NRIs are still expected to report rental income from Indian properties on their U.S. tax returns and can generally claim a foreign tax credit to avoid double taxation on the same income,” he says.
If an NRI sells property in India
There are no provisions in the law that alter the capital gains tax treatment of overseas real estate. “NRIs based in the United States must continue to record and pay capital gains tax on the sale of Indian property, and they can claim a foreign tax credit for taxes paid in India. However, the bill's emphasis on remittances may have an impact on how sales earnings repatriated to the United States are treated, especially after 2025,” says Naik.
Is this the right time to invest in property back home?
“At present, the Big Beautiful Bill does not alter the core U.S. tax rules governing foreign property ownership or rental income. From a tax perspective, this means it remains a reasonable time for NRIs to consider investing in Indian real estate,” says Ankit Jain, Partner, Ved Jain and Associates.
Yes, it is still a good moment to invest. Beginning on January 1, 2026, cash-based transfers will be subject to the 1% remittance tax. While lower than earlier proposals, the tax adds a cost to sending funds abroad, which is particularly relevant for large property-related transfers.
Since the majority of bank and card-based channels are exempt, NRIs can execute transactions without worrying about the immediate tax implications. “With the Indian Rupee comparatively weak and real estate prices in major cities stabilising, now is a good time to invest before the new tax takes effect,” says Naik.
“NRIs may consider restructuring their investment portfolios, timing big remittances before December 31, 2025, and engaging a tax professional to ensure that their plans are in line with the new regulations,” says Naik.
Anagh Pal is a personal finance expert who writes on real estate, tax, insurance, mutual funds and other topics
