How to repatriate funds with an international money transfer

Repatriation of funds involves converting foreign currency into someone’s home currency. It’s a process that many US expats, companies and US workers in foreign countries have to go through. Major banks can help you with overseas payments, but their services can come with high fees and markups that make it more expensive to send money overseas. Compare your options to discover how to repatriate funds with an international money transfer and save money.

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How to repatriate funds to the US in six steps

Follow these steps for the repatriation of funds to the US after comparing your money transfer options:

1. Visit your preferred money transfer provider’s website or physical branch.
2. Provide your personal contact information and any required ID.
3. Input details for your transfer, including your recipient’s information and how you’d like your money delivered.
4. Pay for your transfer using cash, a credit or debit card or a bank account.
5. Confirm your rate and fees, then complete your transfer.
6. Keep all receipts to make it easier to pay taxes on your transfer.

How do I compare money transfer services?

Take these factors into account when weighing the strengths and weaknesses of transfer specialists and currency providers.

• Exchange rates. The majority of providers skew exchange rates for a profit. Finding the best rate can make a substantial difference, especially if you’re transferring large amounts of money. Compare the rates of a range of companies against the mid-market rate as a baseline to find the smallest margin among them.
• Transfer fees. Most companies will charge you a fee when sending a transfer overseas. Find out whether the provider charges a flat fee or a percentage of your transfer. If you’re sending a large amount, ask whether you qualify for a fee-free transfer.
• Flexible transfer options. Some companies will allow you to schedule payments ahead of time or protect your transfer against market fluctuations with a limit order or forward contract to make more cost-effective international transfers.
• Pickup options and delivery speeds. Most providers offer online transfers directly to US bank accounts, while others also offer the convenience of cash pickup if you need your funds in a hurry. You may be able to deliver your funds in minutes, but if you have more time, you’ll save money on expedited fees.
• Customer support. When you’re moving money overseas, especially large amounts, help whenever you need it is reassuring. Look for a company that offers multiple support options — online chat, phone, in person or by email — during convenient hours.
• Reputation. Online research will reveal reviews for many transfer companies. Learn whether they’re trusted by consumers, and ask friends and family if they have any recommendations to help you make your final decision.

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Why might I need to repatriate funds?

Among the many reasons you might need to send money back to the United States:

• You want to send money you’ve saved from working overseas back to your loved ones.
• You’re moving to the US and need an affordable way to transfer your assets.
• You receive a salary or pension into an overseas bank account.
• You own rental property in another country that generates income.
• You’re based overseas but need to make mortgage payments on a property in the US.
• You have investments in assets overseas that you want to sell in exchange for foreign currency, convert that currency to US dollars, and then send to the States.

Tax responsibilities of repatriated income

Repatriated income is income that is earned abroad and can be repatriated to avoid tax penalties. When it comes to money in general, repatriation is the process of converting foreign currency — regardless of how it’s acquired — into the currency of one’s home country. Some countries restrict how much you can repatriate, and you may need to pay taxes in the US on your repatriated income depending on how much you’re returning home.

If you operate a business in another country, you’ll typically need to periodically repatriate your profits into your company’s home currency. You can avoid losing some of those profits to a weak exchange rate by finding a money transfer specialist that provides strong rates, low fees and flexible options that can protect your regular transfers from market fluctuations.

The repatriation tax rate you’ll pay as a US-based multinationals is based on US corporate tax on foreign profits after those profits are repatriated to the United States. At that time, your income or profits are subject to a repatriation tax. The current US repatriation tax rate is up to 35%. However, the government periodically enacts repatriation tax holidays that sharply reduce the tax rate in an effort to encourage multinationals to repatriate their overseas profits.

In general, international taxation applies to people or businesses that owe under the tax laws of a foreign country. Repatriating your income from another country to the US could subject your profits to double taxation: once in the country you’ve earned it in and again in the US once it’s in your home currency. To compensate for this double taxation, the US typically provides a credit to US-based multinationals for the foreign income taxes they paid in the earning country.

What are the pros and cons of repatriating funds?

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Frequently asked questions

• What's the best money transfer service to use?

  It depends on your specific needs — such as where you’re sending money, how fast your recipient needs your funds and how you’ll pay for the transaction. We recently took on the challenge of sending money internationally to uncover providers that are setting the benchmark for costs, trust, speed, convenience and more.

• Are there certain countries from which I will not be able to repatriate funds?

  Yes. The US currently restricts money from countries it’s imposed economic sanctions on — for example, Iran and Syria. Many transfer providers will also not offer their services from unstable countries around the world. Be sure to confirm that your provider will accept your transfer.

• What is the definition of expatriation?

  An expatriate — or, more commonly, an expat — is a person temporarily or permanently living in a country other than that of their citizenship.

• Can I repatriate funds through my overseas bank?

  Yes, your overseas bank can send an international wire transfer for you. Just watch out for weak exchange rates and high fees.