Beginning with tax returns filed in early 2026 for the 2025 tax year, the Internal Revenue Service will phase out paper refund checks, requiring most individual taxpayers to receive their federal tax refund through direct deposit or another electronic payment method. The change, ordered under Executive Order 14247, is part of a broader effort by the federal government and Treasury Department to modernize federal payments, improve refund security, and reduce processing delays.
Beginning in 2026, the Internal Revenue Service will replace most paper refund checks with electronic payments. The change, directed by Executive Order 14247, is part of the federal government's plan to modernize the delivery of refunds and other federal payments. The Treasury Department stated that the move will reduce costs, enhance security, and improve the delivery of refunds to individual taxpayers.
During the 2025 filing season, the IRS issued 93.5 million tax refunds. Of those, 93 percent were delivered through direct deposit into verified bank accounts, while only 7 percent were mailed as paper checks. Paper refunds are more than 16 times more likely to be lost or delayed, often due to incorrect account numbers or mailing errors. By switching to electronic transfers, taxpayers can avoid delays and receive funds more safely—often within 21 days for an e-filed return.
The process for filing a tax return remains the same, but accurate banking information is now essential. Taxpayers will need to double-check their account numbers and routing details to ensure timely receipt of their refunds. Those without access to a financial institution may qualify for limited exceptions, such as prepaid debit cards or digital wallets. Refund status updates and payment tracking remain available through the IRS website’s “Where’s My Refund” tool, which allows taxpayers and tax professionals to monitor payments issued and confirm receipt of funds.
The decision to eliminate paper checks stems from Executive Order 14247, titled Modernizing Payments To and From America’s Bank Accounts." Signed in March 2025, the order requires all government agencies, including the Internal Revenue Service, to prioritize electronic transfers for refunds and other federal payments. The Treasury Department stated that this initiative aims to enhance efficiency, reduce fraud, and provide taxpayers with faster access to their funds.
Paper refund checks are costly to produce and vulnerable to theft and identity fraud. By contrast, electronic refunds sent through direct deposit arrive more quickly and are easier to track. The IRS reported that electronic payments cost less than one-tenth of what it takes to print, mail, and process paper checks. “This change makes sense for both taxpayers and the government,” the Treasury Department stated in its official notice.
The shift also supports the IRS’s ongoing modernization of tax forms, online services, and refund tracking tools. The agency notes that many taxpayers already rely on the IRS website to check their refund status, update direct deposit information, and file electronically.
The electronic payment mandate aligns the IRS with other government agencies that already use electronic transfers, such as the Social Security Administration. These systems have reduced refund delays, improved fraud detection, and ensured that payments issued reach recipients securely and reliably. For the IRS, applying similar procedures to federal tax refunds means fewer errors, faster refunds, and a more reliable process overall.
Most refunds will now require accurate banking information. The Internal Revenue Service urges taxpayers to double-check their account number, routing number, and joint account details before filing a tax return. Direct deposit remains the quickest way to receive a federal tax refund—typically within 21 days for an e-filed return—while paper checks may still take six weeks or more to arrive by mail.
The IRS and Treasury Department are developing limited exceptions for taxpayers who are unable to receive electronic payments. These include unbanked individuals, Americans living abroad, and those with verified hardships. Approved alternatives may consist of prepaid debit cards or digital wallets that meet federal payment standards.
Tax professionals recommend filing electronically, verifying tax forms, and using the IRS website’s “Where’s My Refund” tool to track refund status and avoid delays. “Direct deposit provides taxpayers the fastest, safest access to their funds,” the IRS said in its September 2025 notice.
The Internal Revenue Service says the phaseout of paper refund checks will make refunds faster and safer. “Taxpayers should expect their refunds more quickly and with fewer risks of loss or theft,” said IRS Commissioner Daniel Werfel. The Treasury Department added that the move strengthens protections against fraud and identity theft while reducing costs for the federal government.
The National Taxpayer Advocate cautioned that modernization must not disadvantage taxpayers who are unbanked, rural, or elderly. “Efficiency should not come at the expense of accessibility,” the office said, urging clear exception procedures and additional support for those without traditional bank accounts.
Experts from the Tax Foundation and the Bipartisan Policy Center supported the change, stating that it will reduce refund delays and improve accuracy. “Direct deposit eliminates many of the refund issues we see each filing season,” said tax preparer Denise Carter. “It’s faster, safer, and helps prevent fraud.”
Taxpayers should review their banking information before the next filing season to ensure smooth processing. The Internal Revenue Service recommends verifying account numbers, joint account details, and financial institution information on all tax forms. Incorrect data can cause refund delays or result in payments being sent to the wrong account.
Filing an e-filed return with direct deposit is the fastest way to receive a federal tax refund. The IRS website’s “Where’s My Refund” tool allows taxpayers to check refund status, confirm payments issued, and start checking within 24 hours after filing. Paper returns and mailed checks can take up to six weeks to process, which can extend the wait for funds.
Those without a bank account or with verified hardships can apply for limited exceptions. The IRS and the Treasury Department plan to offer alternative payment options, including prepaid debit cards and digital wallets, to ensure all taxpayers have access to their funds.
“Most refunds will continue to arrive quickly and securely through direct deposit,” the IRS said in its official notice. “Taxpayers who prepare early and verify their information can avoid unnecessary delays and receive their refunds safely.”
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