Paper refund checks phased out for individual taxpayers

The IRS, working with the U.S. Department of the Treasury, recently announced that paper tax refund checks for individual taxpayers will be phased out beginning on September 30, 2025, as required by Executive Order 14247, to the extent permitted by law. This marks the first step of the broader transition to electronic payments.

The IRS will publish detailed guidance for 2025 tax returns before the 2026 filing season begins. Until further notice, taxpayers should continue using existing forms and procedures, including those filing their 2024 returns on extension of a due date prior to Dec. 31, 2025.

Here’s what your clients need to know.

The change is designed to do the following:

• Protect taxpayers: Paper checks are more than 16 times more likely to be lost, stolen, altered, or delayed than electronic payments. Direct deposit also avoids the possibility that a refund check could be returned to the IRS as undeliverable.
• Speed up refunds: Electronic refunds give taxpayers faster access to refunds, with payments issued in less than 21 days if filing electronically, choosing direct deposit and there are no issues with the return, compared to non-electronic payments that may take 6 weeks or longer for refunds sent by mail.
• Cut costs: Electronic payments are more efficient and cost less than paper.

What this means for individual taxpayers

• Filing stays the same: Taxpayers should continue to file their returns as they normally would, using one of the existing filing options.
• Refunds go digital: Most refunds will be delivered by direct deposit or other secure electronic methods.
• Help for those without access to bank accounts: Options such as prepaid debit cards, digital wallets, or limited exceptions will be available.
• Act now: Taxpayers should make sure they know their banking information or consider opening a free or low-cost account. Visit FDIC: GetBanked and MyCreditUnion.gov for account options.

Most individual taxpayers already receive their refunds by direct deposit into their bank accounts. During the 2025 tax filing season, the IRS issued more than 93 million tax refunds to individual income tax filers; 93% of those, almost 87 million refunds, were issued through direct deposit. Only 7 percent of individual refund recipients received their refunds by check through the mail.

Next steps

Executive Order 14247 also applies to payments made to the IRS. Taxpayers should continue to use existing payment options until further notice. Additional guidance and information for filing 2025 taxes will be issued prior to the 2026 filing season.

The IRS will share updated guidance on IRS.gov and through outreach efforts nationwide.

Source: IRS