economy
1.4 million filers face tax refund delays amid IRS paper check phaseout
Many filers are facing tax refund delays amid the IRS push to phase out paper checks. Here's what to know if you receive a CP53E notice.
TL;DR
- Approximately 1.4 million IRS notices (CP53E) have been sent to filers regarding refund delays due to paper payment requests.
- The IRS is transitioning from paper checks to electronic payments to protect taxpayers, speed up refunds, and reduce costs, as mandated by a 2025 executive order.
- Taxpayers receiving a CP53E notice must provide updated banking information within 30 days via an IRS online account to receive direct deposit, or wait six weeks for a paper refund.
- The change disproportionately affects 'unbanked' individuals, seniors, the unhoused, and younger filers who may lack consistent access to technology or stable addresses.
- Average tax refunds have increased this season, partly due to changes enacted by President Donald Trump's administration, but rising costs of living and fuel prices could offset these gains.
- Supporters of the transition cite benefits like reduced errors and increased security with electronic payments, but critics point to implementation challenges and lack of advance notice for filers.