The US government is planning a big change in how it sends money to its people. Starting September 30, 2025, all federal departments and agencies will stop using paper checks and switch to digital payments.
This decision came after President Donald Trump signed an executive order on March 25, 2025, called “Modernizing payments to and from the United States bank account.”
The aim is to save money, reduce delays, and lower the risk of fraud or theft. The government believes that digital payments are safer and quicker than mailing paper checks, which can get lost or stolen.
Why the US Government Is Ending Paper Checks
Since the COVID-19 pandemic, there has been a rise in mail theft. The government noticed many complaints from people saying their checks were stolen, lost, or tampered with.
According to the executive order, Treasury checks are 16 times more likely to be reported lost or stolen compared to digital payments. That’s a huge difference, and it shows why this change is necessary.
Experts say switching to digital payments will bring many benefits like better safety, less paperwork, and faster transactions. It will also help the government save a lot of money.
Digital Payments Are Cheaper Than Paper Checks
Sending tax refunds and Social Security payments through paper checks costs two to four times more than digital transfers. That’s because checks need to be printed, mailed, and then cashed by the recipient. On the other hand, electronic transfers such as direct deposit or digital wallets are fast, low-cost, and easy to manage.
The US Treasury Department sends thousands of checks every year. Now, it will have to move to digital methods like bank transfers, debit/credit cards, or mobile wallets. There will be some exceptions for people who don’t have bank accounts, but those will be limited.
Use of Paper Checks Is Declining in the US
Paper checks are slowly becoming a thing of the past. Since 2010, the government has tried to reduce the use of checks. In 2011, they stopped using checks for Social Security and Veterans Affairs benefits. A survey from 2024 shows that 46% of Americans didn’t use checks at all in 2023, and only 15% used them once in a while.
However, older people above the age of 55 are more likely to use checks. Around 22% of them still use paper checks every month. Experts are concerned that elderly people may be targeted by scams during this shift to digital. So, it’s important to help them learn how to use online banking safely.
How to Switch from Paper Checks to Digital Payment
If you still receive your tax refund or government benefit as a paper check, here’s how you can switch to digital payments:
Check Your Refund Method
When you file your tax return, you can choose how to receive your refund—either by check or direct deposit. If you get a check, it’s likely because you didn’t enter your bank details.
Choose Direct Deposit
Next time you file your return, select the direct deposit option and provide your correct bank account and routing numbers. Be sure the information is accurate to avoid problems. Once your return is processed, you can’t change the method, but you can contact the IRS at 800-829-1040 to ask for help.
For Amended Returns
If you file an amended return (Form 1040-X), you can select direct deposit, but this only applies to the new refund amount, not the original one.
Use Helpful IRS Tools
You can use the “Where’s My Refund?” tool to track your refund. It’s best to file electronically (e-file) and combine it with direct deposit. If you live outside the US, you can still get direct deposits in foreign bank accounts. However, avoid using someone else’s bank account to receive your payment.
The US government’s move to end paper checks is a big step toward modernizing its payment system. This change will help reduce fraud, save time and money, and make things easier for both the government and the people. While some elderly citizens may need help adjusting to the new system, the benefits of switching to digital payments are clear.
It’s important for everyone to prepare for this change and update their bank details when filing returns. With more people choosing digital payments, paper checks may soon become a thing of the past.
