IRS Refund Rules: You Can Still Pay by Check but Refunds Now Come by Direct Deposit is one of the most important updates in the 2026 tax season. If you’re still used to mailing in that trusty paper check or waiting for your refund to show up in the mailbox, it’s time to saddle up — because the IRS is riding fast into the digital age.Whether you’re a tribal elder filing your 40th return, a college student getting your first W-2, or a small business owner juggling quarterly payments, this change affects everyone. Let’s break it down like we’re sitting at the kitchen table with a cup of coffee — keeping it simple, real, and practical.
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IRS Refund Rules
The IRS is serious about going digital — and for good reason. It’s faster, cheaper, and safer for both you and the government. While paying by check is still an option, refunds will now almost always be direct deposited. So don’t get left behind waiting by the mailbox. Add your bank info to your return, double-check your numbers, and keep your eyes on the refund tracker. Whether you live in the city or on the reservation, this is your cue to go digital — with confidence.
| Topic | Details |
|---|---|
| IRS Check Payments | Still allowed, but discouraged long-term |
| Refunds | Direct deposit is now the default |
| Paper Refund Checks | Phased out after Sept 30, 2025 |
| IRS Official Page | https://www.irs.gov/refunds |
| Average Refund (2025) | $3,213 |
| Processing Time (e-File + DD) | Approx. 21 days |
| Common Mistakes | Incorrect bank details, missing vouchers |
| Professional Tip | Set up split deposits using Form 8888 |
| Best Payment Method | IRS Direct Pay (free, fast, secure) |
Why the IRS Refund Rules Changing?
This isn’t just some tech gimmick — it’s part of a broader plan by the federal government to make transactions faster, safer, and more efficient. According to Executive Order 14247 and the IRS Modernization Strategy, the goal is to replace legacy systems and reduce paper handling by over 80% in the next five years.
What’s driving the change?
- Fraud prevention: In 2022 alone, the IRS flagged over 1 million fraudulent refund claims — many involving stolen checks.
- Cost savings: It costs the IRS about $1.20 to issue a paper check, versus just $0.02 for a direct deposit.
- Speed: Refunds through direct deposit arrive in less than half the time.
So while you can still pay your taxes using a paper check, don’t expect to receive a paper check refund in return — unless you qualify for certain exceptions.
You Can Still Pay the IRS by Check?
For those who feel more comfortable writing a check, you’re still covered — for now.
Acceptable IRS Payment Methods
- Check or Money Order
- Payable to: “United States Treasury”
- Include: SSN, tax year, tax form number (e.g., 1040), and payment voucher (e.g., Form 1040-V)
- IRS Direct Pay
- Free online tool to pay from checking or savings
- https://www.irs.gov/payments/direct-pay
- EFTPS (Electronic Federal Tax Payment System)
- Preferred for business payments and high-dollar personal taxes
- Requires enrollment, but offers recurring and same-day options
- Debit/Credit Cards
- Accepted via IRS-authorized processors
- Includes processing fees (around 1.87% for credit)
- IRS Online Account
- Track your balance, schedule payments, and view notices
- https://www.irs.gov/payments/your-online-account
What to Know When Mailing a Check
- Use the correct IRS mailing address, which varies by state and form
- Double-check the voucher code and SSN match
- Send via tracked mail for proof
But here’s the thing: the IRS may eventually stop accepting checks for certain types of payments, especially once digital tools become universal.
IRS Refund Rules: Refunds Now Come by Direct Deposit
Here’s the big shift: Refunds are now almost exclusively issued via direct deposit. If you don’t opt in with banking info, you may experience delays or added steps.
This change took full effect October 1, 2025, and applies to most Form 1040 filers.
How to Get Direct Deposit
To set it up:
- Provide your routing number and account number on the refund section of Form 1040
- Indicate if the account is checking or savings
- Make sure the name on the return matches the name on the bank account
You can even use Form 8888 to split your refund among multiple accounts — useful if you want to set aside part for savings, part for bills, and part for investing.
What Happens If You Don’t Provide Bank Info?
- The IRS may send a letter asking for your direct deposit details.
- If no response after 30 days, you might receive a delayed paper check — but that’s no guarantee.
- In some cases, the refund could be held or applied to prior-year debts (offsets).
Use Case: Small Business Owner Filing Quarterly
Let’s take “Elena,” who runs a small beadwork shop in North Dakota. She pays quarterly estimated taxes using EFTPS, but every year she files a 1040 with her husband. In 2025, she got a $2,800 refund mailed by check — but in 2026, she didn’t receive anything.
Why? Because she filed without entering bank info, assuming the IRS would mail a check like before. But this year, she got a letter requesting her bank account details. By the time she replied, it had been 7 weeks — and the refund was delayed by nearly two months.
What If You Don’t Have a Bank Account?
About 5.9 million U.S. households were “unbanked” in 2021, according to the FDIC. If you don’t have access to a bank account, you still have options:
- Open a low-fee checking account through local credit unions or tribal banks
- Use a prepaid reloadable card that accepts direct deposit
- Consider a Treasury-sponsored debit card program (if reintroduced)
Many Native communities are working with financial literacy programs to help elders and unbanked individuals access these tools.
Common Mistakes That Delay Refunds
- Entering incorrect routing numbers
- Using closed accounts
- Misspelling account holder names
- Selecting “checking” when it’s really a savings account
- Forgetting to update bank info after switching banks
If there’s a mismatch, the IRS may reject the deposit and start a manual refund trace, which takes weeks.
What Tax Pros and CPAs Are Advising?
- “If you’re filing for clients over 60, help them set up direct deposit right away.”
— Jason M., CPA, Arizona - “We’ve already added a checklist to all 1040s requiring bank info. It’s not optional anymore.”
— Sabrina T., Enrolled Agent - “For tribal clients, I recommend prepaid cards if banking isn’t accessible. The refund still arrives fast.”
— Leon R., Tax Preparer, Oklahoma
Final Filing Checklist
- Do you have your bank routing and account numbers ready?
- Have you selected Direct Deposit on your 1040?
- Did you confirm the name matches your bank info?
- Are you e-filing for fastest processing?
- Have you reviewed the Where’s My Refund tool timeline?
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