Incorrect Banking Information for Direct Deposit: A Mistake That Could Delay Your Tax Refund

When filing a tax return, one of the details that should be reviewed most carefully is the banking information used to receive a possible refund through direct deposit.

Although providing an incorrect account or routing number may seem like a minor mistake, the consequences can be significant. The IRS warns that an incorrect or transposed number can cause a financial institution to reject the deposit, return it to the IRS, or, in certain cases, even cause the money to be deposited into an account belonging to someone else.

For this reason, carefully reviewing your banking information before signing and submitting your tax return is one of the most important steps you can take to avoid problems with your refund.

What Banking Information Should Be Reviewed?

When requesting a direct deposit, you must provide the correct routing number and account number for the appropriate financial institution.

These details should be verified directly with your bank or financial institution. The IRS recommends not assuming that information shown on a debit card, an old check, or a banking application is necessarily the correct information for the type of account being used.

It is also important to confirm that the account can receive this type of deposit and that the information matches the taxpayer who will receive the refund.

What Can Happen If the Account Number Is Incorrect?

There are different possible outcomes depending on the type of error.

If a digit is missing or the information provided does not pass the applicable validations, the deposit may be rejected, and the taxpayer may receive a notice with additional instructions.

In other cases, the account or routing number may be incorrect but still match a valid account. If the financial institution rejects the deposit, the funds may be returned to the IRS, and the taxpayer may then receive instructions on what to do next.

The most complicated situation occurs when the number provided belongs to another person and the financial institution accepts the deposit. In that case, the taxpayer may need to work directly with the financial institution to try to recover the funds. The IRS states that it is not responsible for errors made by the taxpayer or the tax preparer.

An Incorrect Number Can Lead to a Delay

One of the main problems with providing incorrect banking information is that the taxpayer may have to wait longer to receive their money.

If the deposit is rejected and the funds are returned to the IRS, the process does not necessarily end immediately. Depending on the circumstances, the taxpayer may need to receive a notice, contact the financial institution, or begin a refund trace.

The IRS states that if the taxpayer has already contacted the financial institution and five calendar days have passed without the deposit being recovered, it may be necessary to file Form 3911 to begin a refund trace.

Can You Change Your Bank Account After Filing Your Taxes?

This is another common question among taxpayers.

In general, once a tax return has already been processed by the IRS, you cannot simply call and request that the banking information used for direct deposit be changed.

However, beginning in 2026, there are specific situations in which a taxpayer who receives a CP53E notice may be able to update their banking information through their IRS Online Account. The IRS explains that this option is connected to receiving that particular notice and that specific rules apply when making the update.

For that reason, it is not recommended to wait until a problem occurs before checking your banking information. The information should be reviewed before the tax return is submitted.

The Account Holder's Name Also Matters

The direct deposit of a tax refund should be directed to an account belonging to the appropriate taxpayer.

The IRS indicates that a refund may generally be deposited directly into an account in the taxpayer's name, the taxpayer's spouse's name, or both names when using a joint account. Financial institutions may also reject a deposit when the account holder's name does not match the information associated with the refund.

This is especially important when using joint accounts, newly opened accounts, or certain bank accounts that may have restrictions on receiving deposits.

What Should You Do Before Filing Your Tax Return?

The best way to avoid this type of problem is to review your banking information along with the rest of your tax return before submitting it.

It is recommended that you confirm the routing number and account number directly with your financial institution, verify that the account is eligible to receive the deposit, and carefully review all the numbers before signing and filing your return.

It is also important to make sure that you have not accidentally entered a debit card number instead of your actual bank account number, since these are different pieces of information.

Conclusion

Direct deposit can be a fast and convenient way to receive a tax refund, but it requires accurate banking information.

A single incorrect number can cause the deposit to be rejected, the money to be returned to the IRS, or, in more serious situations, the funds to be sent to an incorrect account. Resolving these problems may require additional time and communication with both the financial institution and the IRS.

For this reason, before filing your taxes, carefully review your routing number, account number, account type, and account holder information. An extra review can help you avoid unnecessary delays and problems when receiving your tax refund.