IRS Urges Taxpayers to Add Banking Details for Faster Tax Refunds

The IRS is encouraging taxpayers to include banking details when submitting tax returns this filing season, highlighting that such information helps in getting refunds faster, the agency said in an April 2 statement.

Taxpayers who do not include direct deposit information on their returns, or whose provided account information is incorrect or rejected by the bank, may receive a CP53E notice from the IRS.

Taxpayers have 30 days from the receipt of the notice to add or update a bank account. The information can be updated via their IRS Individual Online Account.

After logging into the account, users can navigate to “profile,” “banking information,” and “add bank account” options and submit their direct deposit information, according to the agency.

Once the information is submitted, it takes two to five days for it to update online. Taxpayers who do not respond to the notice will be issued a paper check for refunds after six weeks.

However, paper checks are 16 times more likely to be stolen, lost, altered, or delayed than electronic payments. Moreover, direct deposit prevents the possibility of refund checks returning to the IRS as undeliverable.

In its latest statement, the IRS said that taxpayers “do not have to wait to receive the notice to act.”

“They can check the Where’s My Refund? tool for next steps and if this situation applies to them, they can use their IRS Individual Online Account to resolve the issue quickly by providing accurate banking information or the reason they cannot,” the agency said.

IRS employees are not authorized to update bank account information over the phone or in person due to security concerns.

“Only about one percent of taxpayers received a CP53E notice informing them that their banking information on the return is missing or invalid,” the agency said.

Taxpayers who have no bank account can seek an exception from the IRS and receive paper checks. Such exceptions are available for taxpayers under certain conditions, such as hardship.

“With less than two weeks left in the filing season, the IRS continues to provide historically outstanding service to taxpayers,” IRS Chief Executive Officer Frank J. Bisignano said.

“Tens of millions of Americans are getting their refunds direct deposited in their bank accounts and their returns processed promptly without error or delay.”

The IRS had announced phasing out of paper checks beginning Sept. 30, 2025, in response to a March 25, 2025, executive order from President Donald Trump—”Modernizing Payments To and From America’s Bank Account.”

The use of paper-based payments by the federal government imposes “unnecessary costs; delays; and risks of fraud, lost payments, theft, and inefficiencies,” Trump wrote in the order. In addition, maintaining the infrastructure to digitize paper records cost taxpayers more than $657 million in fiscal 2024 alone.

The order mandated the “transition to electronic payments for all Federal disbursements and receipts by digitizing payments to the extent permissible under applicable law.”

April 15 Is Right Around the Corner

The 2026 filing season kicked off on Jan. 26, with the deadline for submitting returns set at April 15. In January, the IRS said it was expecting 164 million tax returns this time.

At the time, the White House said that millions of Americans were poised to receive “significantly larger tax refunds” due to the many beneficial provisions of the One Big Beautiful Bill Act, such as an additional deduction for seniors and no taxes on tips or overtime up to certain income thresholds.

On March 27, the IRS announced the average refund amount for the 2026 filing season was $3,571 as of March 20, up by 10.9 percent from $3,221 during the same period last year.

The agency has disbursed more than $202 billion in refunds to taxpayers so far, a jump of nearly 13 percent.

The IRS said in its recent statement that more than 80 percent of refunds this filing season were issued in less than 21 days. Out of the total 57 million refunds issued by the agency, more than 98 percent were disbursed electronically via direct deposit.

Meanwhile, the IRS said on March 20 that more than 1.3 million people in the country have unclaimed tax refunds worth around $1.2 billion.

These unclaimed refunds belong to taxpayers who did not file their federal tax return for the 2022 tax year. The median refund amount is estimated to be $686. Taxpayers have until April 15 to submit returns and claim these refunds.