Get Ready for Online Payments to the IRS

On March 25, 2025,President Trump issued an Executive Order that mandates a transition to electronic payments for all Federal disbursement and receipts, including tax refunds.  https://www.whitehouse.gov/presidential-actions/2025/03/modernizing-payments-to-and-from-americas-bank-account/. The Executive Order directs the Federal Government to cease issuing paper refund checks by September 30, 2025 and all federal receipts should be processed electronically “as soon as practicable”.  The order exempts “unbanked and underbanked” taxpayers.

The goals of the order:

·        Defend against financial fraud and improper payments. Treasury checks are 16 times more likely to be reported lost or stolen, returned undeliverable or altered than electronic payments.

·        Increase efficiency and reduce costs.  

·        Enhance the security of Federal payments.  Digital payments are not susceptible to mail fraud.

The public comment period has closed and there have been no further updates or guidance at this time.  So barring any further developments, taxpayers need to prepare for this transition now.

Refunds – We can set up refunds to be direct deposited into financial institutions when submitting your income tax returns.  Many of our clients are already doing this.  In order to set up the deposits, we will need your bank information to be provided to us.  This should be done securely through our portal or conversation, it should not be given to us via email – we won’t accept it given this way.  WE CAN ONLY SET UP THE REFUND TO BE DIRECT DEPOSITED WHEN FILING YOUR RETURN.  WE CANNOT SET THIS UP AFTER THE RETURN IS FILED.

If the return is filed without bank information, it is most likely that the Treasury will issue debit cards sent via mail much like they did with rebates.  Debit cards can be easily lost or stolen.

Payments – if the Executive Order holds, all payments will need to be made electronically.  Much like refunds, we can set up payments due and estimated tax payments to be made electronically when we file your return. We will need your banking details. If estimated taxes need to be changed after filling the return, we can provide you with a phone number to make those changes.  WE CANNOT SET ELECTRONIC PAYMENTS UP AFTER THE RETURN IS FILED.  ALSO AFTER THE RETURN IS FILED, WE DO NOT HAVE THE ABILITY TO MAKE PAYMENTS FOR YOU.  

If you do not give us banking details or do not want us to set up payments to be drafted out of your account, it is your responsibility to make payments.  Payments can be made free of charge with a credit or debit card at www.irs.gov/payments.  You can also make payments from your mobile device by downloading the fee IRS2Go app on your device.  MOST LIKELY YOU WILL NEED TO MAKE ANY 2025 FOURTH QUARTER ESTIMATED PAYMENTS ELECTRONICALLY.

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