IRS FAQ on Mandatory Electronic Payments

By Aaron Klein, CPA-East Texas

In IRS Newswire, IR-2026-13, the IRS issued FAQs about Executive Order 14247: Modernizing payments to and from America's Bank Account and issued IRS Fact Sheet 2026-02.

Some Key Highlights:

• The federal government must continue to issue certified payments in some limited circumstances and will issue a limited number of paper checks in cases where no alternative is available.
  • Alternative methods for taxpayers without bank accounts include payment via certain mobile apps and prepaid debit cards. Limited exceptions will be created but are not defined at this time.
    
• What should taxpayers do now to prepare?
  • Ensure their direct deposit information is up to date when filing their tax return.
  • Consider opening a low- or no-cost bank or credit union account if they do not currently have one. Resources to open an account at a bank or credit union are available at www.fdic.gov/getbanked and MyCreditUnion.gov.
  • Monitor IRS.gov for updates on alternative electronic payment options and exception processes for those who cannot receive funds electronically.
• In most cases, transition should not delay refunds. Electronic delivery is faster and more secure than paper checks. In most cases, taxpayers will receive their refunds sooner by using electronic methods, eliminating the risk of their paper check being lost or stolen.
• Providing electronic payment information is voluntary. However, if taxpayers do not include electronic payment information and no exception applies, the return will still be accepted and processed, but refunds could take longer.
• For all taxpayers with missing banking information on filed returns, the IRS will send letters using their last-known address on file asking them to update their banking information. The taxpayer will then receive Notice CP53E requesting a response within 30 days to provide banking information or explain why it cannot be provided.
  • If the taxpayer responds, the refund will be immediately released via direct deposit of paper check. If there is no response, a paper check will be released after six weeks.
• The IRS will NOT contact taxpayers by phone or text to request banking info, only correspondence will be via letter through the U.S. mail.
• No changes on current process of issuing paper checks to decedent accounts. When changes are made, the IRS will provide additional guidance.
• For now, mailed payments to the IRS will still be accepted and processed. Over time, the IRS intends to fully transition to electronic methods.
• The IRS is expanding digital payment system capabilities to make it easier to pay electronically. A list of available options with links is included in Topic B, Q3.
• Effective Oct. 17, 2025, individuals are no longer able to create new enrollments for EFTPS. All individuals will be required to transition from EFTPS later in 2026.

There are several other FAQs regarding cash payments, business accounts, international taxpayers and third-party stakeholders in Topics C, D, & E of the FAQs.

While there is still additional guidance needed on select topics, these do provide some much-needed guidance on the transition to electronic payments and deposits with the IRS.

See IRS Issues FAQs About Trump Executive Order on Electronic Payments