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Federal Reserve Remittances

Definition

Federal Reserve Remittances refer to the annual transfer of excess earnings from the Federal Reserve System to the U.S. Treasury. The Federal Reserve generates income primarily from interest on its holdings of U.S. government securities acquired through open market operations. After covering its operating expenses and paying dividends to member banks, any remaining profits are remitted to the Treasury. These remittances are a significant source of non-tax revenue for the government.