Executive Order – Phase Out Of Paper Checks
On March 25, 2025, President Trump signed an Executive Order with a goal to phase out paper-based payments by the Federal Government. This includes checks and money orders flowing into and out of the United States General Fund. The reason given for the Order is to eliminate unnecessary costs, delays, risk of fraud, lost payments, theft, and inefficiencies associated with non-electronic payments. Apparently, Treasury checks are 16 times more likely to be reported lost or stolen, returned undeliverable, or altered than an electronic funds transfer.
Beginning September 30, 2025, to the extent permitted by law, the Secretary of Treasury will stop issuing paper checks for all Federal disbursements which includes tax refunds, with limited exceptions.
The order also affects payments made to the Federal Government. The order reads “As soon as practicable, and to the extent permitted by law, all payments made to the Federal Government shall be processed electronically, except as specified in Section 4 of this order.”
This is important to taxpayers because most future tax refunds will be by electronic funds transfer apparently effective September 30, 2025.
Regarding payments made to the Federal Government, the timeline is “As soon as practicable” for payments to be rendered by electronic funds transfer. Apparently, this will include estimated tax payments and payments for amounts owed with the filing of a tax return unless an exception as allowed in Section 4 is provided to taxpayers. You may want to do some forward planning on how to make electronic funds transfers for payment of tax liabilities.
Caution: This explanation is general in nature and should not be used for specific planning. Contact a tax professional for your specific planning needs.