IRS Announces Direct Deposit for Amended Return Refunds

As part of its efforts to streamline services for taxpayers, the IRS has announced that, as of 2023, amended returns will be eligible for direct deposits of any resulting refund.

In 2020, the IRS began accepting electronically-filed Form 1040-X amended return forms. However, until 2023, any resulting refund could only be sent to taxpayers by a physical check, resulting in a possible delay and loss of security. With this change, taxpayers will be able to both file amendments, and receive resulting refunds, electronically – which both increases security and speeds up the process.

It’s important to note that every amended return still must be processed manually by the IRS, which may result in an extended wait for any return. However, by eliminating the mailing and manual handling at both ends, this interval is trimmed to a minimum. The recent hiring of a significant number of telephone operators, and additional staff for Taxpayer Assistance Centers (TACs), is expected to reduce this required processing time.

Taxpayers may still choose to submit Form 1040-X by physical mail, as well as receive any resulting refund by physical check, if it’s more convenient.

As your trusted tax advisor, Weiss & Company LLP is committed to providing a high level of support for all of your filing needs, including amended returns. Should you have any questions about this new feature, we encourage you to reach out to your tax professional.