The Internal Revenue Service stopped issuing most individual paper refund checks after Sept. 30, 2025, carrying out Executive Order 14247’s mandate to move federal payments off paper and onto direct deposit. The government says paper checks are more than 16 times likelier to be lost, stolen, altered or delayed than an electronic payment. Ninety-three percent of the 93.5 million individual refunds issued in the 2025 filing season arrived by direct deposit, leaving roughly 6.5 million taxpayers who relied on the mailed check the government now treats as the exception — and for a filer with no banking information on file, what used to be automatic is now a paperwork problem.
Executive Order 14247 and the September 2025 Cutoff
President Trump signed Executive Order 14247, “Modernizing Payments To and From America’s Bank Account,” on March 25, 2025, directing the Treasury Department to stop issuing paper disbursements — tax refunds, Social Security benefits, vendor payments and other federal outlays — to the extent the law allows. The IRS confirmed on Sept. 23, 2025, that individual refund checks would begin phasing out that same month, making tax refunds one of the earliest categories the order reached. The stated rationale goes beyond speed: a paper check mailed to a home address is also the payment type most exploited by thieves who intercept, alter or forge it before a taxpayer ever sees the money.
The order does not touch how a return gets filed. Taxpayers still complete the same forms, through the same software or preparers, on the same schedule as before. What changed is what happens after the IRS approves a refund — the default outcome is now a deposit into a bank account, a prepaid debit card or a digital wallet, not an envelope in the mail. Electronic refunds typically arrive within 21 days of an e-filed return, while a refund that ends up as a mailed check can take six weeks or longer once a return needs manual handling.
The change lands hardest on filers who have never set up direct deposit, a group that skews older. Retirees who historically received Social Security by paper check have been slower to convert to electronic payments than working-age filers already on payroll direct deposit, and the IRS has not published an age breakdown of the 7% still receiving mailed refunds. The agency’s own outreach material points account-less filers toward the FDIC’s account-opening program as the resource most likely to apply to that group.
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What Happens When a Refund Has No Bank Account On File
Providing direct deposit information on a tax return is technically voluntary, but skipping it now triggers a specific process rather than an automatic check in the mail. If a return is missing banking details and no exception applies, the IRS mails a letter to the taxpayer’s last-known address asking for the information. A filer who submits electronically may also see an on-screen alert flagging the gap before the return is even transmitted, and the IRS’s refund-status tool now displays messaging tied to the requirement.
A taxpayer who does not respond to that first letter receives a formal notice, CP53E, giving 30 days to either supply direct deposit details or explain why they cannot. The IRS says it will only ever request this information by mail, never by phone or text, a distinction the agency is stressing because callers impersonating it have long tried to pry banking numbers out of taxpayers. If the 30-day window closes without a response and nothing else is wrong with the return, the refund is finally released as a paper check, but only after a six-week wait that direct-deposit filers never face.
The agency built one workaround into the process: a taxpayer can log into the IRS Individual Online Account at any point and add banking information there, releasing the refund immediately rather than waiting out the notice period. That online account is now the only way to supply the information yourself — IRS employees are barred from taking direct deposit numbers over the phone or in person for security reasons, even from a taxpayer calling to resolve the exact notice described above.
Exceptions for the Unbanked, Hardship Cases and What Comes Next
The order does not assume every taxpayer has a bank account. For filers without one, the IRS says alternative electronic methods — certain prepaid debit cards and mobile payment apps — will substitute for direct deposit, and the agency is coordinating with the FDIC, the National Credit Union Administration and U.S. Bank to help unbanked filers open free or low-cost accounts before they file. Limited exceptions to the electronic requirement remain for hardship cases and unspecified legal or procedural situations, and refunds owed to a deceased taxpayer’s estate are, for now, still processed under the old rules.
The same shift is reaching how taxpayers pay the IRS, not only how they get paid. Executive Order 14247 also pushes the Electronic Federal Tax Payment System toward sunset for individual users during 2026 — new enrollments closed in October 2025, and everyone still using the system will eventually have to move to the IRS Online Account or Direct Pay instead. Businesses face a parallel, slower transition: direct deposit has been added to most business return types as a first step, with paper business refund checks phased out over a longer timeline.
None of this changes who is entitled to a refund or how much they get; it changes how long the wait is for anyone who does not adapt. A filer who enters banking information before filing is paid in roughly three weeks, same as always. A filer who leaves that field blank now enters a notice-and-response cycle that can stretch the wait past two months — a cost the government has shifted from its own mailroom onto whichever taxpayers are slowest to go paperless.
This article was researched and drafted with the assistance of artificial intelligence.
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