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IRS Refunds · In the News

The IRS Is Ending Paper Refund Checks — What the Move to All-Electronic Payments Means for You

5 min read · By Jonathan C. Do, Esq. · August 2026

The days of watching the mailbox for an IRS refund check are ending. Under a 2025 executive order, the IRS has begun phasing out paper refund checks for individual taxpayers — the first step in moving nearly all federal payments, in both directions, to electronic methods. If you've always taken your refund as a check, or you mail payments to the IRS, this affects you.

What the IRS announced

In IR-2025-94, dated September 23, 2025, the IRS confirmed that paper tax refund checks for individual taxpayers would be phased out beginning September 30, 2025, as required by Executive Order 14247, "Modernizing Payments To and From America's Bank Account." The agency said it would publish detailed guidance for 2025 tax returns before the 2026 filing season, and that until then, taxpayers should keep using existing forms and procedures.

Two points are easy to miss. First, the order eventually applies to payments you make to the IRS, not just refunds coming out. Second, it reaches business taxpayers too — the electronic shift isn't limited to individuals.

Why the IRS says it's doing this

The government's case rests on three claims from the announcement:

• Security. The IRS says paper checks are over 16 times more likely to be lost, stolen, altered, or delayed than electronic payments.
• Speed. Electronic refunds are typically issued in less than 21 days when you e-file and choose direct deposit, versus six weeks or more for a mailed check.
• Cost. Electronic payments are cheaper for the government to process than printing and mailing paper.

The scale explains the confidence. During the 2025 filing season, the IRS issued more than 93.5 million refunds to individual filers, and 93% — almost 87 million — already went out by direct deposit. Only about 7% still came as a mailed check.

What this means for you

Filing itself doesn't change.

You still file your return the same way. What changes is how the money moves: most refunds will now arrive by direct deposit or another secure electronic method.

You need to give the IRS good banking information.

The single most important step is making sure the IRS has accurate account and routing numbers. A typo can send your refund to the wrong place — so double-check before you file.

No bank account? There are options.

The IRS has said prepaid debit cards, digital wallets, and limited hardship exceptions will be available for people who can't use direct deposit. If you're unbanked, the agency points to resources like FDIC's GetBanked program for opening a free or low-cost account.

Watch for the scams that follow big changes

Every major IRS change is followed by a wave of impersonation scams, and this one is tailor-made for it. Expect texts, emails, and calls claiming you must "verify your bank details to receive your electronic refund" or "update your payment method." The IRS does not initiate contact by text or email to demand banking information. Don't click links in unsolicited messages, and confirm anything unexpected by going directly to IRS.gov or calling the number on a genuine IRS notice.

If you owe — the flip side matters too

As the electronic mandate extends to payments made to the IRS, taxpayers with a balance or on an installment agreement should get comfortable with electronic options like IRS Direct Pay and EFTPS. If you're behind and worried about collection action, the shift to electronic payments doesn't change your rights — but staying ahead of deadlines still does.

About the author: Jonathan C. Do is a tax attorney with 25+ years representing businesses and individuals in IRS audits, appeals, collections, and U.S. Tax Court matters. He practices at Tax Resolution Center LLC in San Jose, CA.