Taxpayers can get faster tax refunds with Direct Deposit

IR-2019-69, April 10, 2019

WASHINGTON — With the tax deadline nearly here, the Internal Revenue Service encourages all taxpayers to join the 80 percent of filers who choose Direct Deposit to get their tax refund faster.

Direct Deposit into a bank or other account is a secure option. It avoids the possibility of lost, stolen or undeliverable refund checks. The IRS uses the same system to deposit tax refunds that Social Security and Veterans Affairs use to deposit 98 percent of benefits into millions of accounts.

Choosing Direct Deposit is easy when electronically filing. A taxpayer – or their tax preparer – simply selects it as the refund method in their tax software and enters account and routing numbers. Paper filers should follow the instructions on their tax form. With either method, double check entries to avoid errors.

Direct Deposit also saves taxpayer money. It costs the IRS more than $1 to issue a paper refund check, but only a dime for each direct deposit.

E-file plus Direct Deposit yields fastest refunds

The IRS urges taxpayers to file electronically. While a person can choose Direct Deposit no matter how they file, e-filers will typically see their refund in fewer than 21 days.

Taxpayers can use IRS Free File or commercially available tax software to electronically file. E-filing vastly reduces tax return mistakes, as the tax software does the calculations, flags common errors and prompts taxpayers for missing information. The tax software also reflects tax law changes, such as those from the Tax Cuts and Jobs Act, so taxpayers don’t need to know all the details to make sure they’re getting their taxes done right.

Split refunds

A taxpayer can deposit their full tax refund into one account or split the refund into two or three financial accounts, including a bank or Individual Retirement Account. Part of the refund can even be used to purchase up to $5,000 in U.S. Series I Savings Bonds.

When filing electronically, a taxpayer can split their refund by using the process outlined in the tax software. Those filing a paper return split a refund by using IRS Form 8888, Allocation of Refund (including Savings Bond Purchases).

The IRS reminds taxpayers they should only deposit tax refunds directly into accounts that are in their name, their spouse’s name or both if it’s a joint account. No more than three electronic tax refunds can be deposited into a single financial account or prepaid debit card. Taxpayers who exceed the limit will receive an IRS notice.

Tracking a tax refund

Taxpayers can track their refund using "Where’s My Refund?" It’s available on IRS.gov or by downloading the IRS2Go mobile app. “Where’s My Refund?” is updated once daily, usually overnight, so there’s no reason to check more than once per day. The “Where’s My Refund?” tool has the same status information as IRS phone staff. Taxpayers can check “Where’s My Refund?” within 24 hours after the IRS has received their e-filed return. Paper filers can check four weeks after they mailed their paper return. “Where’s My Refund?” has a tracker that displays progress through three stages: (1) Return Received, (2) Refund Approved, and (3) Refund Sent.

Other last-minute tips from IRS

Extensions. April 15, 2019, is the deadline for most to pay taxes owed and avoid penalty and interest charges. Because of the Patriots’ Day holiday on April 15 in Maine and Massachusetts and the Emancipation Day holiday on April 16 in the District of Columbia, taxpayers who live in Maine or Massachusetts have until April 17 to file their tax returns and pay any taxes they owe.

If a taxpayer needs more time to file, they can avoid a late-filing penalty by requesting an extension of time to file. An extension of time to file is not an extension to pay. Taxpayers can file up to six months later when they have an extension, but their tax payment is still due by the original due date.

There are several ways to get an extension: 

  • Use the Free File link on IRS.gov.
  • File Form 4868, Application for Extension of Time To File U.S. Income Tax Return, electronically or by mail.
  • Make an electronic payment and designate it as an extension payment. Taxpayers can get an automatic extension of time to file when making a full or partial payment with Direct Pay, the Electronic Federal Tax Payment System or by debit or credit card. When paying electronically, taxpayers must select Form 4868 as the payment type and choose the payment date to get the automatic extension. With this method, there’s no need to file a paper or electronic Form 4868. However, taxpayers should keep the confirmation as proof of the payment and extension. With Direct Pay and EFTPS, taxpayers can request email notifications about their payment.

Payment options. Taxpayers who owe taxes can use IRS Direct Pay or any of several other electronic payment options. They are secure and easy and taxpayers receive immediate confirmation of their payment. Or, taxpayers can mail a check or money order payable to the “United States Treasury” along with a Form 1040-V, Payment Voucher. Taxpayers who can’t pay by the tax deadline often qualify to set up a monthly payment agreement with the IRS using the Online Payment Agreement option on IRS.gov.

Paycheck Checkup. The IRS encourages taxpayers to do a Paycheck Checkup to review their tax withholding. They can use the IRS Withholding Calculator and should make any needed adjustments early in 2019. Doing a Paycheck Checkup can help taxpayers avoid having too little or too much tax withheld from their paychecks. Taxpayers can generally control the size of their refund by adjusting their tax withholding.

For 2019, a Paycheck Checkup is especially important for taxpayers who adjusted their withholdings in 2018 – specifically in the middle or later parts of the year. It’s also important for taxpayers who owed additional tax when they filed this year or those who want to adjust the size of their refund for next year. When using the calculator, it’s helpful for taxpayers to have their completed 2018 tax return available. For details see Tax withholding: How to get it right.

Beware of scams. Watch out for email schemes.Taxpayers will only receive an email from Direct Pay or EFTPS if they’ve opted in for email notifications when they use Direct Pay or EFTPS. Taxpayers who get an unsolicited email claiming to be from the IRS or an IRS-related function should report it to phishing@irs.gov.

For further help and resources, check out the IRS Services Guide.

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