IRS makes major change to how it handles your tax returns: What to know

For years, the Internal Revenue Service has offered tax payers the option of receiving their returns via paper check by mail, or direct deposit.

But those days are coming to end.

Starting Sept. 30, the IRS and U.S. Department of Treasury will start phasing out paper refund checks.

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"This marks the first step of the broader transition to electronic payments," the announcement reads .

"The IRS will publish detailed guidance for 2025 tax returns before the 2026 filing season begins."

The agency said taxpayers should continue using the existence forms and procedures for filing their taxes in the meantime.

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According to the IRS, the change is designed to protect taxpayers, speed up refunds and cut costs.

"Most individual taxpayers already receive their refunds by direct deposit into their bank accounts," the agency wrote in the announcement. "During the 2025 tax filing season , the IRS issued more than 93.5 million tax refunds to individual income tax filers, and 93% of those, almost 87 million refunds, were issued through direct deposit."

Only 7% of taxpayers opt for receiving their returns via paper check.

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While the procedures for filing taxes will remain the same, refunds will start being delivered by direct deposit or other secure electronic methods and increase help for people without bank accounts.

For people who don't have access to bank accounts, options such as prepaid debit cards and digital wallets may make accessing their returns easier than before.

Taking action

Before the 2025 tax season kicks off, people who usually opt in for a paper-check return should start preparing for when they might receive an electronic refund.

The IRS encourages taxpayers to "make sure they know their banking information or consider opening a free or low-cost account," before tax season is underway.

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