Tax insight

IRS issues FAQs about modernizing federal payments under Executive Order 14247

Insight
5 minute read
February 05, 2026

What happened?

The IRS issued Fact Sheet 2026-02 (Fact Sheet) on January 27, 2026, to help clarify how Executive Order 14247—Modernizing Payments To and From America’s Bank Account—will transition payments both to and from the IRS to fully electronic channels. The Fact Sheet includes FAQ sections covering five topic areas—Individual Refunds and Disbursements, Payments to the IRS, Businesses, International Taxpayers, and Third-party Stakeholders—and outlines practical steps, timelines, and payment methods involved.

Why is it relevant?

The shift to digital options is underway in accordance with the Executive Order, signed March 25, 2025. Treasury and IRS began phasing out paper tax refund checks and other disbursements on September 30, 2025, with a complete move to digital options anticipated by late 2026. Limited exceptions to electronic methods will be made for specific situations, such as hardships or legal and procedural requirements. These narrow exceptions have left some taxpayers unsure how to proceed.

Actions to consider

Taxpayers and practitioners can use the Fact Sheet as a planning guide to better understand the implementation timeline and electronic payment methods available as the government moves away from paper payments and should monitor for new updates that reflect changes in guidance or law.

Although the IRS is providing a phased path to full implementation, the ultimate objective is to end all paper payments. Taxpayers should take steps to prepare by planning system updates and updating processes to support electronic payment as transition progresses.