Compliance
Compliance Checklist: Reporting Car Loan Interest & Remittance Tax under OBBB
Due to new laws under the One, Big, Beautiful Bill, lenders and remittance transfer providers face fresh reporting burdens and excise‐tax compliance; this guide helps stay ahead before deadlines bite.
By NomadicTax Research Team • 5-8 min read • November 23, 2025
## What’s New & Why It Matters
Two compliance obligations introduced under OBBB require immediate attention:
1. **Car Loan Interest Reporting**: Lenders who receive car loan interest in 2025 will be subject to new information reporting requirements. To ease the transition, **Notice 2025-57** provides **penalty relief** for certain lenders who comply late or make mistakes in early filings.([irs.gov](https://www.irs.gov/newsroom/news-releases-for-october-2025?utm_source=openai))
2. **Remittance Transfer Excise Tax (Section 4475)**: Starting in 2026, remittance transfer providers will owe an excise tax for certain transfers using cash, money orders, cashier’s checks or similar instruments. **Notice 2025-55** gives penalty relief through the first three calendar quarters of 2026 for those who fail to deposit excise tax on time, as long as they satisfy a reasonable cause standard.([irs.gov](https://www.irs.gov/newsroom/news-releases-for-october-2025?utm_source=openai))
## Key Compliance Steps for Lenders & Providers
| Stakeholder | Action Items | Timeline |
|------------|---------------|-------------|
| **Car lenders & financial institutions** | * Identify interest-receiving activities that trigger reporting<br>* Prepare to issue information returns showing car loan interest amounts received in 2025<br>* Review occupation classification and ensure proper Form-1098 or similar forms are updated | Late 2025 (some requirements already in effect under guidance) and into the first quarter of 2026 as forms become available |
| **Remittance transfer providers** | * Determine whether transfers using cash/instruments qualify under section 4475<br>* Track deposit schedules (semimonthly deposits) for the excise tax when applicable<br>* Understand relief rules and penalties via Notice 2025-55 to avoid full penalty exposure | First three quarters of 2026 (relief applies), with full enforcement to start thereafter |
## Example Scenarios
- A used car dealership provides financing and receives interest payments: must report interest to customers and IRS using correct forms. If failing to file in early 2026, penalty relief may apply under Notice 2025-57 if criteria met.
- A remittance business accustomed to moving cash payments internationally will now need to collect excise tax on transfers made with cash or similar instruments, make semimonthly deposits, and file quarterly returns—failing which could incur penalties, though relief provided in early periods.([irs.gov](https://www.irs.gov/irb/2025-43_IRB?utm_source=openai))
## Penalty Relief & Transitional Guidance
- For **car loan interest reporting**, the IRS is offering **safe harbor** provisions during transition via Notice 2025-57 to reduce or avoid penalties.([irs.gov](https://www.irs.gov/newsroom/one-big-beautiful-bill-provisions?utm_source=openai))
- For **remittance excise tax**, Notice 2025-55 allows providers who meet a “reasonable cause” standard to avoid penalties on deposit failures for the first three quarters of 2026. It doesn’t automatically waive liability—you must document cause.([irs.gov](https://www.irs.gov/irb/2025-43_IRB?utm_source=openai))
## Common Missteps & How to Avoid Them
- Assuming all interest on any vehicle qualifies—only certain loans and occupations may be covered under “qualified interest” definition. Employers/payors must file statements.([irs.gov](https://www.irs.gov/newsroom/one-big-beautiful-bill-provisions?utm_source=openai))
- Not tracking when transfers are made via cash or similar physical means — the type of instrument matters for remittance excise tax. Missing that distinction can cause compliance gaps.
- Failing to watch income thresholds, occupation definitions, and residency rules for senior or tip/overtime related deductions.
## Moving Forward
- **Training staff, updating systems** to collect new data (tip amounts, overtime details, car loan interest, instrument type in remittances)
- **Consulting with tax professionals or advisors** about how to incorporate these reporting obligations into regular cycles
- **Monitoring IRS for finalized regulations and forms**, especially related to “no tax on tips” rule and standard deduction vs itemized deductions calculations.([eitc.irs.gov](https://www.eitc.irs.gov/newsroom/topics-in-the-news?utm_source=openai))
## Summary
Complying with OBBB’s new rules for car loan interest reporting and remittance excise tax requires diligence. However, with transitional relief and clear guidance, those who prepare now can minimize risk while harnessing the law’s benefits before enforcement tightens. Stay informed and build compliance into your Q4 and early‐2026 workflows.