Why the IRS may temporarily freeze your tax refund and how to avoid it

(NEXSTAR) – Tax season is in full swing, and with the chance at “very large” refunds, you may feel inclined to file as quickly as possible. A small mistake, however, may slow down how quickly that refund comes to you.

Receiving a tax refund via direct deposit has long been the fastest, most-advised payout option by the IRS. That’s especially true this year as a new rule, enacted by an executive order last year, kicks in.

The order, signed by President Trump, calls for “payments to and from America’s bank account” to be modernized. Ultimately, it marks an end to paper checks and money orders for transactions with the federal government, with a few exceptions. It also applies to benefits paid by Social Security and the Department of Veterans Affairs, and, of course, your federal tax refund.

On Monday, the IRS’s Taxpayer Advocate Service (TAS) explained that if you are owed a refund but don’t include direct deposit information when filing your taxes this year, or if that information is invalid, your refund could be temporarily frozen.

According to the TAS, your refund will remain frozen until you provide direct deposit information or you request a paper check.

Should your refund be frozen, you’ll receive a CP53E notice. It will direct you to add or update your direct deposit information through the IRS’s website, generally within 30 days. If you don’t, the IRS said it will send you a paper check after six weeks.

If your direct deposit is rejected, the TAS said you’ll need to take action and paper checks will not automatically be issued. You will receive a CP53E notice only once and can only update your bank information once, the agency said.

If you do not have direct deposit information, you can request a paper check waiver through your IRS Online Account.

Aside from opening a bank account, the IRS said some mobile apps and prepaid debit cards can be used to route a refund, as long as they have a routing and account number. Refunds can also be sent to IRAs (traditional, Roth, and Simplified Employee Pension). If you don’t have access to a digital payment option, you may qualify for a “Treasury-sponsored” alternative like the Direct Express Debit Mastercard.

Regardless, your tax return will be processed, the IRS said. You can find more details, including how to receive assistance by phone, here.

According to the IRS, those who opt for direct deposit typically receive their refunds within three weeks.

The IRS previously noted that every refund check it issues “costs the nation’s taxpayers more than $1,” while direct deposit refunds cost about a dime.

If you owe the IRS after filing your taxes, there are no changes to paying the agency this year. The TAS said additional updates could begin in 2027.