To reduce fraud, cut costs, and increase efficiency, President Trump signed an executive order requiring the federal government to modernize its payment system. To the extent possible under existing law, federal agencies will transition to sending and receiving payments (such as Social Security benefits payments and tax refunds) electronically by September 30, 2025. Paper checks will no longer be issued or accepted.

Exceptions

There are provisions in the executive order providing limited exceptions to this mandate. These apply to individuals who do not have or have limited access to banking services.

What does this mean for your tax refund and payment?

Fortunately, there are robust and secure systems currently in place that issue refunds and make tax payments electronically. At the time of filing, you can provide bank information with your tax return that will directly deposit your refund into the account of your choice. This is the most secure and fastest method for receiving your refund. You can also designate your refund to directly deposit into up to three accounts including a checking, savings, and/or retirement account.

Currently, quarterly estimated tax payments and balance due payments are made online at irs.gov/payments, directly from your bank account, debit card, credit card, or digital wallet. This is also where you can make an extension payment prior to the April 15th deadline.

In addition, the IRS has a mobile app available called IRS2Go where you make secure payments and check the status of your refund. For business tax payments, you can enroll in the Electronic Federal Tax Payment system to securely make payments for employment and excise taxes, for example.

As always, if you have questions about your specific situation, don’t hesitate to reach out to your KT Tax Advisor.