Sponsors (4)
This bill speeds and secures replacement refunds by promoting direct deposit and reducing paper-check processing, but it may create access and verification barriers for unbanked or vulnerable taxpayers and imposes short-term regulatory costs on the IRS.
Taxpayers who qualify for replacement refunds can receive their money faster by electing direct deposit instead of waiting for a paper check.
Taxpayers receiving replacement refunds face lower risk of lost, stolen, or delayed mail and reduced chance of fraud or theft when they elect direct deposit.
The IRS could reduce administrative costs and processing time associated with reissuing paper checks if more taxpayers choose direct deposit.
Low-income and unbanked taxpayers who lack access to bank accounts or distrust direct deposit may face reduced access to timely refunds if paper-check options are de-emphasized.
If regulations require additional identity or banking verification to elect direct deposit, some taxpayers may experience delays or difficulty completing the election and receiving refunds.
Requiring the IRS to issue regulations within six months creates a short-term administrative burden and implementation cost for the agency.
Based on analysis of 2 sections of legislative text.
Requires Treasury to allow taxpayers eligible for a replacement paper refund check to elect direct deposit for that replacement, via regulations issued within six months.
Requires the Treasury Department to write rules within six months so taxpayers who qualify for a replacement paper refund check after a lost or stolen refund can instead choose to get that replacement by direct deposit. The change takes effect immediately on enactment and directs the Secretary to establish procedures allowing taxpayers to elect direct deposit for replacement refunds.
Introduced February 10, 2025 by Nicole Malliotakis · Last progress April 1, 2025