Executive Order 14247 requires federal disbursements, including income tax refunds to migrate from paper to digital form. As can be imagined this is causing some bottlenecks in receiving refunds. Through mid-March, 1.4 million refunds were stuck due primarily to this change. If this happens to you, you will receive an IRS notice CP53E. Here is what you need to know.
Your tax return did not have a direct deposit account noted.
You file a joint tax return, but you have the refund direct deposit in a bank account with only one name on it. Or the name on the bank account simply does not match the name on your tax return.
For whatever reason, you bank rejects the deposit. Either you made an error on the account or routing number, or the bank simply rejects the transaction for some unknown reason.
Do this first, so that you know what action to take. Otherwise, you run the risk of repeating the error and will not solve your problem.
You have 30 days to respond to the notice by going to www.IRS.gov/CP53E. It will direct you to either create or log into your online account at the IRS, an IDme account. Then follow the instructions to correct the error.
This online service tracks the status of your refund. This is a good tool to use to track your refund even if you do not receive a CP53E notice. You will need your social security number, the exact amount of your refund, filing status and tax year. This can be found at: https://www.irs.gov/refunds
What the notice DOES NOT tell you is that if you do not respond, the government will still issue a paper check. But it will take up to six weeks. In this case, double check your address to ensure it is valid.
The IRS cannot take your bank account information over the phone. They will direct you to create or log into your online account.
Unfortunately, you have to fix this one yourself. The IRS does not want you to file an amended tax return to fix this problem, and you should not be providing access to your online account to anyone other than you.
If you do not receive your refund timely, take action. The problem could be unrelated to a direct deposit error. In this case the first place to start is to use the “Where is My Refund?” service.
If you owe money on your taxes, you can still pay using a paper check. This is not the government’s preferred method of receiving funds, but it is still available to you.
The impact of this transition has been significant, prompting concern from both the Treasury Department and the House Ways and Means Committee as they push the IRS to find solutions.
If you receive a CP53E notice, know that you are not alone, and taking prompt action is the best way to get your refund back on track.
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