What you need to know about the tax system in 2025
Learn how the 2025 tax brackets work and what it means for your income taxes this season.
- Taxpayers who did not include bank information on their tax return to receive a direct deposit refund may have to wait several months for a paper check to arrive.
- On March 25, 2025, President Donald Trump signed an executive order ending the issuance of paper checks to the extent permitted by law.
- According to the National Taxpayer Advocate, more than 10 million individual taxpayers received refunds via paper checks last year as well.
Taxpayers expecting a federal income tax refund end up using the wrong type of paper when they want a paper tax refund check. Instead of seeing cash refunded, they receive an IRS notice.
By mid-March, the Internal Revenue Service planned to send more than 830,000 notices, formally known as IRS Notice CP53E, to individual taxpayers who failed to include bank account information on their tax returns. That’s according to a March 9 letter from two Democratic Congressional leaders, Rep. Danny Davis of Illinois and Rep. Terry Sewell of Alabama, to Scott Bessent, the acting commissioner of the Internal Revenue Service.
The letter expressed concerns about new rules regarding the elimination of paper tax refund checks during the 2026 tax season.
“After reviewing the IRS notice and calling the IRS line, we found that there is no easy process for these taxpayers to request immediate release of their refund via paper check without waiting at least 10 weeks,” Davis and Sewell wrote.
“In effect, the President, through his executive order, has unilaterally delayed paper refunds for months, causing undue hardship to millions of Americans. This delay is not required by the Internal Revenue Code,” the March 9 letter said.
The IRS does not allow you to update your bank account information by calling a toll-free number. Instead, taxpayers who receive these letters are asked to take several steps and are currently told that they can only update their bank account information by accessing their IRS online account within 30 days of receiving the CP53E notice.
And the IRS says, “If you don’t respond to the notice, we’ll issue you a paper check after six weeks. For the most up-to-date information on your refund status, see Where’s My Refund?” ” states.
Yes, there’s a big headache ahead for people who are expecting a refund but don’t provide their bank account information when filing their 2025 federal income tax return.
To make matters worse, some taxpayers in this situation may be financially vulnerable or have few support systems.
In some cases, online banking, apps, and websites can be difficult for non-tech-savvy people to use. Some people may not trust financial institutions and may not want to open a bank account.
Davis and Sewell noted that some taxpayers who want paper refund checks may not have access to direct deposit because they don’t have bank accounts.
The National Taxpayer Advocate raised concerns about people without bank accounts during the transition from paper checks. “According to the Federal Deposit Insurance Corporation’s 2023 report, 4.2% of U.S. households, or approximately 5.6 million people, do not have a checking or savings account,” the National Taxpayer Advocate wrote last October.
“Without a bank account or other facilities, it is impossible to receive a direct deposit. For these people, a paper check is not a priority, but a lifeline.”
or “have a disability or face a systemic or geographic issue that prevents them from creating an online IRS account or receiving an electronic tax refund.”
The National Taxpayer Advocate also noted that some religious communities, including some sects of the Amish and Mennonites, avoid using electronic financial systems altogether based on deeply held religious beliefs.
Additionally, the National Taxpayer Advocate noted that domestic violence victims may be unwilling or unable to share banking information with the IRS due to safety, control, and privacy concerns. “In some cases, abusers may monitor the victim’s financial transactions, such as savings, which may reveal the victim’s whereabouts and financial activities, leading to further abuse or stalking,” the advocate’s blog states.
Matt Heatherwick, chief program officer at the nonprofit Fiscal Assistance Association in Detroit, said he recommends that taxpayers have their direct deposit information ready and accessible before they prepare their tax return.
Several free or low-cost account options exist. For tips, see FDIC: GetBanked and MyCreditUnion.gov.
Heatherwick noted that CP53 notices are sent when there is a problem with the direct deposit information provided to the IRS. “Taxpayers should always review and double-check their tax returns before the preparer files them to avoid mistakes,” Heatherwick said.
On March 25, 2025, President Donald Trump signed an executive order to end the issuance of paper checks to the extent permitted by law, suggesting that issuing paper checks “imposes unnecessary costs, delays, fraud, risks of lost payments, theft, and inefficiencies.”
As a result, the IRS is phasing out paper checks this tax season.
Most people already receive their tax refund through direct deposit into their savings or checking account. According to a National Taxpayer Advocate blog posted in October, about 94% of individual taxpayers provided direct deposit information on Form 1040 during the 2025 filing season.
Still, more than 10 million individual taxpayers still received their refunds in paper checks last year, according to the National Taxpayer Advocate.
The IRS previously announced that it will send a letter to individuals asking them to update their bank information if they do not provide it on their 2025 federal income tax return. Or, if your direct deposit is rejected by your financial institution, you’ll receive a letter.
If your bank information is missing when you file your tax return, the IRS will still accept and process your return. It will only cause further delays in receiving your federal income tax refund.
“When filing electronically, taxpayers may receive a warning notifying them that bank information is missing and outlining next steps if a refund is due,” the IRS said.
If you receive a notice, you should take immediate steps to get your tax refund.
“Once you receive a CP53E notice, you must update or add a new bank account within 30 days,” the IRS says online.
The IRS says the following steps are required.
- To add or update your bank account information, you must access your account and establish an online account. The IRS says taxpayers will receive a message indicating that their bank account update was successful. “If there is a problem with your changes, you will receive an error message. Read all messages carefully and promptly follow any instructions given,” the IRS says.
- Once the process is successfully completed, please allow 2-5 days for your refund information to be updated online.
- Please use the refund tool to check your refund status.
- If you encounter a system issue that prevents you from updating your bank account information, please read the message carefully and try again later.
Contact personal finance columnist Susan Tompol: stompor@freepress.com. follow himr X @tompor.
