The IRS recently released a comprehensive set of frequently asked questions explaining how it will implement Executive Order 14247, Modernizing Payments To and From America’s Bank Account. The FAQs address common concerns from individuals, businesses, and tax professionals as the federal government continues its transition away from paper checks and toward electronic payment methods.
While the Executive Order itself was signed in 2025, the newly issued FAQs provide timely clarification on how refunds will be issued, how payments should be made, and what taxpayers should expect during the transition.
According to the IRS, paper refund checks have generally been phased out after September 30, 2025, to the extent permitted by law. Going forward, refunds are expected to be issued electronically, with limited exceptions when no electronic alternative is available.
Importantly, the IRS emphasized that this change does not affect how tax returns are filed. Taxpayers should continue using existing filing methods while ensuring that electronic payment information is included when a refund is expected.
The IRS acknowledges that not all taxpayers have access to traditional banking services. Individuals without bank accounts will still be able to receive refunds using alternative electronic methods, such as certain prepaid debit cards or approved mobile payment options. In limited hardship or legally required situations, paper checks may still be issued.
To help taxpayers prepare, the IRS encourages individuals to review available low-cost or no-cost banking options and to monitor IRS guidance as additional electronic alternatives become available.
The FAQs also explain what occurs when a taxpayer does not provide banking information on a filed return. While providing direct deposit details is voluntary, missing information may delay the issuance of a refund. If this occurs, the IRS will contact the taxpayer by mail only, requesting updated banking information.
Taxpayers will not be contacted by phone, text, or email for this purpose. Once banking information is provided, or an exception applies, the refund will be released. If no response is received, the IRS may ultimately issue a paper check after additional processing time.
Yes. The FAQs clarify that Executive Order 14247 applies not only to refunds, but also to payments made to the IRS. While checks and money orders are still accepted for now, the IRS is actively encouraging taxpayers to use electronic options such as IRS Direct Pay, online IRS accounts, debit or credit cards, and digital wallets.
The IRS also confirmed that EFTPS will be phased out for individual taxpayers in late 2026, with a transition toward IRS Online Accounts and Direct Pay. Individuals currently enrolled in EFTPS may continue using it for now, but should begin preparing for the eventual change.
For businesses, more business tax returns will offer direct deposit options for refunds, allowing refunds to be issued more quickly and securely. Over time, paper refund checks for businesses will also be phased out.
Third parties (such as payroll providers, trustees, and tax professionals) should expect increased reliance on electronic payment systems and ensure their internal processes can support these methods. The IRS indicated that additional guidance and training resources will be provided as the transition continues.
The IRS’s recent FAQs provide important clarification on how electronic payment modernization will work in practice. While most taxpayers already use electronic methods, those who rely on paper checks (either for refunds or payments) should begin preparing now to avoid delays.
If you have questions about how these changes may affect your tax filings, refund timing, or payment processes, we can help you navigate the transition.
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