Tax News

Modernizing Payments to and from America's Bank Account

The IRS has released new guidance regarding Executive Order 14247, which focuses on modernizing how payments are sent to and from the federal government. These changes are designed to reduce fraud, improve security, lower processing costs, and make transactions—such as tax refunds and tax payments—faster and more reliable.

What’s Changing Beginning with the 2026 filing season, the federal government will transition most payments to electronic methods. This includes:

• Refunds, benefits, grants, and other payments issued by the government

• Payments made to the government, such as tax balances due, fees, and penalties

Paper checks and money orders will still be accepted for now, and this does not change how you file your tax return. Only the payment and refund methods are being modernized.

What You Should Do Now To prepare for these upcoming changes, the IRS recommends:

• Using direct deposit for your tax refund

• Choosing electronic payment options when paying taxes (e.g., IRS Direct Pay or EFTPS)

• Ensuring your bank account or prepaid debit card information is accurate and up to date

• Reviewing IRS resources if you do not currently have a bank account

Limited exceptions will be available for hardship or specific legal circumstances.