The IRS refund process is undergoing significant changes under the leadership of President Donald Trump. In March 2025, Executive Order 14247, titled “Modernizing Payments to and from U.S. Bank Accounts,” was signed to initiate a comprehensive shift in how refunds are issued.
The new plan aims to phase out paper checks and move entirely to digital payment methods, marking a major step toward streamlining government operations and improving efficiency. This shift is part of a broader effort to reduce delays, enhance security, and ensure that taxpayers receive their refunds more quickly. Below, we break down the details of this upcoming change and what taxpayers need to know.
Goodbye Paper Checks: What’s Changing?
The most striking change from this new policy is the gradual elimination of paper checks for IRS refunds, which will be phased out by September 30, 2025. Under this plan, taxpayers will no longer receive physical checks for refunds except in very specific, legally mandated circumstances. This shift is designed to make the IRS refund process faster and more secure by relying on electronic payments, mainly direct deposits.
Currently, 93% of IRS refunds are already made electronically, but the remaining 7% of paper checks often cause delays, postal issues, and security risks such as fraud or theft. By fully transitioning to digital payments, the IRS aims to reduce the maximum waiting time for a refund to 21 days, a significant improvement from the current system.
The goal is to provide taxpayers with quicker access to their refund amounts, which average around $3,000 per return. This speed will not only benefit individual taxpayers but will also improve the flow of money into the broader economy during tax season.
What Should Taxpayers Do to Stay on Track?
To ensure that they receive their IRS refunds without delay, taxpayers must take action. The IRS has confirmed that individuals must update their banking information on Form 1040 or through the IRS.gov portal.
This is crucial because without accurate bank details, taxpayers may face delays, as paper checks will only be issued in exceptional circumstances. The IRS strongly encourages all taxpayers to take this step now, ahead of the September 2025 deadline.
For those who are retired or do not have a traditional bank account, the IRS has recommended using prepaid debit cards as an alternative to direct deposit. This option will help those individuals avoid delays and ensure they still receive their refunds quickly.
As the IRS refund process becomes fully digital, this adjustment will be important for many Americans who may not have easy access to standard banking services.
