Taxpayers Are Receiving IRS Notices Demanding Bank Account Information: Be Alert For Scams

Key Takeaways:

• IRS Notice CP53E is being issued to taxpayers whose refund direct deposit information is missing, invalid, or rejected, though some notices may have been sent in error.

• Fraudsters may be exploiting confusion surrounding these notices by sending convincing fake versions designed to steal personal and financial information.

• Taxpayers should independently verify all IRS communications and only provide sensitive information through official IRS channels.

Upon filing 2025 federal income tax returns, some individual taxpayers have received IRS Notice CP53E demanding that they provide bank account information to receive a refund of overpaid tax. In a number of cases, these notices have been issued even when the taxpayer did not request a refund, raising concerns that fraudulent third-party notices may be circulating with the sole purpose of stealing taxpayers’ financial information.

Notice CP53E is an official IRS notice sent when the agency cannot issue a refund by direct deposit because:

• A taxpayer did not provide bank account information or provided incorrect details;

• The bank rejected the deposit; or

• The taxpayer’s account could not be validated.

The notice requires the taxpayer to add or update their bank account information through their IRS online account within 30 days from the date of the notice.

Background

President Trump’s Executive Order (EO) 14247 issued on March 25, 2026 mandates a transition to electronic payments for all federal disbursements, subject to limited exceptions. As a result, the U.S. Treasury has significantly reduced the issuance of paper checks for refunds of overpaid tax reported on 2025 federal income tax returns.

To comply with EO 14247, the IRS updated its automated systems to scan 2025 Form 1040, line 35, for direct deposit information. When a taxpayer requests a refund but omits or misreports bank account and routing numbers, the system is now programmed to automatically generate Notice CP53E requesting corrected information.

Although the EO is intended to reduce refund theft and improve efficiency, the rapid shift from paper checks to electronic deposits has introduced some uncertainty for both taxpayers and the IRS during the current filing season. Bad actors may be attempting to take advantage of this uncertainty by distributing fraudulent notices designed to harvest taxpayers’ personal and financial information.

Current State of IRS Notices CP53E

Informal reports from IRS Service Centers indicate that the IRS may have inadvertently programmed its systems to issue Notice CP53E to certain taxpayers who did not request a refund on their 2025 federal income tax return. Accordingly, receiving an unexpected Notice CP53E is not, by itself, cause for alarm.

However, some U.S. tax professionals have reported receiving clearly fraudulent versions of Notice CP53E. These fake notices may:

• Direct recipients to non-IRS.gov websites;

• Provide telephone numbers not associated with the IRS;

• Include a QR code to a scam website;

• Allow the refund to be paid via a gift card, etc.; or

• Request a response via email or text message, methods the IRS does not use for initial taxpayer contact.

What You Should Do Now

Tax professionals and their clients should carefully review any notice purporting to be from the IRS. Fraudulent notices have become increasingly sophisticated, often closely mimicking the formatting and tone of legitimate IRS notices.

Vigilance is especially important when a notice requests personally identifiable information or financial details. Taxpayers should only respond to IRS notices by:

• Accessing the IRS.gov website directly;

• Using telephone numbers or mailing addresses known to belong to the IRS; or

• Independently verifying any unfamiliar website, telephone number, or address listed on a notice.

A quick online search can often confirm whether contact information is legitimate and may prevent taxpayers from falling victim to fraud.

How MGO Can Help

As tax scams become increasingly sophisticated, it’s critical for taxpayers to verify the legitimacy of any communications from the IRS before providing any personal or financial information. MGO’s Tax Advocacy and Resolution team can help you evaluate any questionable notices you’ve received, confirm whether communications are legitimate, and navigate interactions with the IRS.

We can also assist with reviewing your account activity, validating refund-related issues, coordinating responses to IRS communication, and helping you implement safeguards to reduce the risk of fraud. Contact us to learn how we can help you protect your sensitive financial information.

Written by Allison Goodhartz, Katelyn Pascuzzi and Susan Pick. Copyright © 2026 BDO U.S.A, P.C. All rights reserved. www.bdo.com