Your recipient won’t have to pay taxes on the money — but you’ll have to tell the IRS.
How Mexico regulates large remittances
Mexico doesn’t levy specific inheritance, estate or gift taxes on large amounts of money transferred into the country, but your recipient may have to report the transfer as income when they file their yearly taxes.
Gifts to spouses, children and parents are exempt, but gifts to siblings are not — and if the government finds out that the stated recipient gave the money to someone else, it won’t be exempt.
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What are the penalties in Mexico if my recipient fails to file?
If your recipient doesn’t list the transfer on their income taxes, they could be charged with tax evasion in Mexico. If they can prove that the failure to list the transfer was accidental, they’ll have to pay any taxes due, along with a penalty. If the failure to file was intentional, they can be criminally charged.
Do I have to report large transfers out of the US?
Possibly. If you’re sending more than $15,000 as a gift, sending to a foreign account in your name that holds over $10,000 or sending over $10,000 as a business, you’ll need to let the IRS know.
By law, banks report cash transactions into and out of the country. Money transfer companies are sometimes held to reporting thresholds as low as $1,000. With so much attention paid to money entering and leaving the country, the government will likely discover if you fail to report large sums out of the US.
How much money can I send to Mexico?
There is no legal limit on the amount of money you can send to Mexico, though transfer providers may impose their own limits. If you’re sending a large transfer, consider using XE, which doesn’t have a cap on how much you can send.
How can my recipient in Mexico get the money?
How your friends and family receive your money transfer depends on the provider and method you’ve used to deliver it. Available options include direct bank transfers, cash pickup and mobile wallet deposits. If you’re sending cash, your recipient may need to show ID or a transaction number to pick up the funds.
As with all international money transfers, be wary of potential fraud and only send money to people you know. Using a reputable provider can safeguard you from potential scams.
How to send money to Mexico
When it comes to tax regulations, Mexico is an easy country to send money to. Your recipient won’t have to fill out any extra forms, and depending on how much you’re sending and who you’re sending it to, you might not have to, either.
Before you start your transfer, compare international money transfer providers to make sure you’re getting the best deal on fees and exchange rates.