Millions of Taxpayers Face Longer Waits for Refunds as Government Phases Out Paper Checks
For millions of Americans, a tax refund is a critical financial lifeline, often used to cover essential expenses or build savings. This year, while many filers are slated to receive slightly higher refunds, approximately 1.4 million individuals who traditionally receive their refunds via paper check may experience significant delays—waiting an extra six to 10 weeks. The root cause is a federal initiative to eliminate paper-based payments entirely, a shift that is already creating confusion and concern for those without direct deposit on file.
The CP53E Notice: A 30-Day Window to Act
The Internal Revenue Service (IRS) has begun mailing CP53E notices to affected taxpayers. These notices explain that to avoid the extended delay, filers must add or update their bank account information through their online IRS account. The notice provides a clear 30-day deadline from the date of receipt to take this action. Failure to respond within that timeframe means the IRS will issue a paper check, but only after an additional waiting period of about six weeks beyond the standard processing time.
Taxpayers can track their refund status through the official “Where’s My Refund?” tool on IRS.gov. The agency emphasizes that electronic deposits are faster, more secure, and the preferred method for the vast majority of filers.
Why the Government Is Ending Paper Refund Checks
The move away from paper checks is not an isolated IRS decision but part of a broader federal mandate. In an executive order issued in late 2024, President Donald Trump directed all federal agencies to transition to electronic payments by October 2025. The order cited numerous problems with paper-based transactions, including heightened fraud risk, processing delays, and substantial costs.
Supporting data underscores these concerns. The order noted a “substantial” increase in mail theft complaints since the COVID-19 pandemic. Furthermore, a Treasury report cited in the order found that digitizing paper records cost taxpayers over $657 million in fiscal year 2024 alone. According to IRS data, while about 93% of refunds are already direct deposited, roughly 7% of taxpayers—approximately 10 million people—still receive paper checks, making this a major logistical shift.
Concerns from lawmakers and taxpayer advocates
The implementation of this policy, however, has sparked pushback from some lawmakers who worry about the impact on vulnerable populations. House Ways and Means Committee Democrats have corresponded with Treasury Secretary Scott Bessent, highlighting a critical discrepancy: the public notice (CP53E) sent to taxpayers does not clearly state that a paper refund could take up to 10 weeks total, nor does it warn that the six-week delay begins only after the 30-day response window closes.
“Our first and foremost concern is that taxpayers could face a 10-week wait for their paper refunds,” the committee stated in a press release accompanying their letter. They argue that clearer communication is essential to prevent financial hardship for those who rely on timely refunds, such as families expecting child tax credit payments or individuals covering urgent bills.
What Taxpayers Should Do Now
If you receive a CP53E notice or suspect your refund will be delayed due to missing direct deposit information, immediate action is required:
- Log in to your IRS Online Account within 30 days of the notice date to securely add or verify your bank routing and account numbers.
- Use the “Where’s My Refund?” tool to monitor your refund’s status. The tool updates once daily and shows whether the IRS is processing your return, has approved your refund, or has sent it via direct deposit or check.
- If you do not have an IRS Online Account, creating one is straightforward and provides a secure portal for managing tax information.
The Treasury Department did not immediately respond to a request for comment from Fast Company regarding the specific timeline discrepancies noted by lawmakers. As the October 2025 deadline approaches, the IRS and Treasury are likely to face continued scrutiny over the transition’s execution and its real-world impact on taxpayers who, for various reasons, have not yet enrolled in electronic deposit.
