As the fall filing deadlines approach for extended 2024 tax returns, many taxpayers may be surprised to find that soon they will no longer receive refunds or be able to submit tax payments in the form of physical checks. Here’s what to know about changes to payment procedures at the US Treasury.
Shift Toward Electronic Payments
Federal agencies have long worked to move taxpayers away from paper checks and correspondence, in favor of e-filing, electronic payments, and direct deposit. Now, at the direction of a March 25th executive order, the Treasury is set to cease issuing paper checks – for all types of payments, including tax refunds and Social Security benefits – as of September 30, 2025.
Additionally, the order directs that “as soon as practicable…, all payments made to the Federal Government shall be processed electronically.” The order cites the many drawbacks of physical checks, including higher costs for processing and mailing, delays, and increased risks of theft and fraud.
Impact on Vulnerable & Underserved Taxpayers
Taxpayers without access to traditional banking will be most impacted by the changes, especially low income, elderly, and rural Native Americans. But many other taxpayers prefer checks for business reasons or privacy concerns. While the executive order allows for limited exceptions and specific policies are expected to be issued, it appears that most taxpayers will need to adopt electronic payments.
IRS Resource Limitations May Complicate Transition
The changes come at a time of limited IRS resources. Facing budget cuts and staffing reductions, the Treasury is also tasked with implementing the provisions of the recently signed One Big Beautiful Bill Act. This likely means slower customer response times if taxpayers encounter issues with the new procedures or are missing refunds.
Steps Taxpayers Should Take Now
While taxpayers await further guidance from the IRS, we recommend that all individual taxpayers set up an online account with the IRS using ID.me. Estimated tax payments can be made through the online accounts or via IRS Direct Pay. Business taxpayers should already be familiar with Federal EFTPS for submitting payments but now should be prepared to provide bank account information with their tax return refund requests. As always, our tax professionals are here to help. Please do not hesitate to reach out to discuss your specific situation.
This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.
