Some IL Taxpayers May See Refund Delays; Here's How To Avoid It

Tax season is ramping up, and many people are already thinking about how to spend their federal refund. However, new changes implemented by the IRS might delay long-awaited refunds for Illinoisans who are used to receiving their returns via paper check.

Last year, President Donald Trump signed an executive order to “modernize payments to and from America’s bank account." The move phases out paper checks and money orders in favor of direct deposit payments for federal tax refunds, as well as Social Security and Department of Veterans Affairs payments.

This could slow down refunds for Illinoisans who file their tax returns without including direct deposit information.

The IRS said that starting in 2026, it will still process individual income tax returns (the Form 1040 series) filed without bank account information, but will temporarily freeze any refund until the taxpayer either provides direct deposit information or requests a paper check.

The IRS also said it will freeze most direct deposits rejected by taxpayers’ banks and will not automatically reissue them as paper checks. If a refund is frozen, the IRS will send taxpayers a CP53E notice explaining the next steps they should take.

The new rules do not apply to taxpayers who are minors, prisoners, deceased, live abroad or claim religious exceptions.

Taxpayers can avoid a freeze by updating their IRS Online Account, where they can either enter their banking information or request a paper check waiver if they do not use direct deposit.

Taxpayers are also advised to double-check their bank routing and account numbers before filing, and to set up an IRS Online Account to respond quickly if they don't already have one.

Click the link for more information.

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