New IRS Rule Created by Trump Could Delay Tax Refunds for Weeks

Taxpayers who opt for direct deposit can expect to receive their refund within 21 days of acceptance of their tax return

NEED TO KNOW

• President Donald Trump signed the “Modernizing Payments To and From America’s Bank Account” executive order in March 2025
• The order instructed the Secretary of the Treasury to stop sending and accepting paper checks for all federal financial transactions
• As a result, taxpayers are encouraged to receive their refund via direct deposit

Some taxpayers may have to wait weeks to receive their tax refunds from the Internal Revenue Service (IRS).

The possible delays are the result of President Donald Trump’s March 2025 executive order, which requires the Secretary of the Treasury to stop sending and accepting paper checks for all federal financial transactions. While the order, titled “Modernizing Payments To and From America’s Bank Account,” was signed in March, it went into effect in September 2025.

As a result, taxpayers are encouraged to opt to receive their refund via direct deposit and can expect it to be issued within 21 days of the date that their tax return is accepted by the IRS.

Those who opt for payment via paper check should expect to wait up to six weeks to receive their tax refund, according to the IRS. The agency says that it will also freeze funds intended for those who make an error when entering their bank account information until the correct information is provided. 

Affected taxpayers will have 30 days to contact the IRS to either request a paper check or provide the correct bank account information. But if the mistake goes unnoticed past the 30-day mark, the taxpayer will receive a paper check — up to six weeks later.

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The “Modernizing Payments To and From America’s Bank Account” was signed to promote “operational efficiency, the White House said in the March 2025 news release.

“The continued use of paper-based payments by the Federal Government, including checks and money orders, flowing into and out of the United States General Fund, which might be thought of as America’s bank account, imposes unnecessary costs; delays; and risks of fraud, lost payments, theft, and inefficiencies,” the statement said. 

Unlike electronic funds transfers, Department of the Treasury checks are 16 times more likely to be reported lost, stolen, altered or returned undeliverable, the White House said.

“Maintaining the physical infrastructure and specialized technology for digitizing paper records cost the American taxpayer over $657 million in Fiscal Year 2024 alone," the statement read.

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