Unclear instructions, limited awareness plagued CP53E rollout, TIGTA says
September 22, 2026
A government watchdog has confirmed what many CPAs and their clients experienced during the 2026 filing season: The IRS’s CP53E notices created confusion among taxpayers as the agency pushed them toward electronic refunds and away from paper ones under an executive order.
About 4.2 million individual taxpayers received CP53E notices directing them to add or update bank account information through their IRS online accounts to receive refunds by direct deposit, the Treasury Inspector General for Tax Administration said in a report last week. If taxpayers took no action after 30 days, the IRS said it would issue a paper check after six weeks.
The IRS held some refunds to encourage taxpayers to provide direct deposit information, TIGTA said. “To foster compliance with the [executive order], the IRS elected to hold refunds for the maximum time allowed for all tax returns that did not have direct deposit information when submitted,” the report said.
Despite the challenges, TIGTA said the IRS has made progress toward electronic transactions. During processing years 2024 and 2025, 654 million of 743 million tax payment and refund transactions, or 88%, were conducted electronically. Read more.
