IRS Notice CP53E: What It May Mean

Many taxpayers are receiving IRS Notice CP53E in 2026 stating the IRS could not direct deposit a refund—even though you were not expecting a refund.

This notice is generally a refund-hold notice connected to the federal government’s move away from paper checks, per Executive Order 14247. It usually does not mean your tax return is wrong or that a refund has been disallowed.

Why taxpayers are receiving CP53E

CP53E can be generated when there is a refund but:

1. No bank information was included on the return;
2. The routing/account information is invalid;
3. The bank rejected the attempted direct deposit; or
4. IRS processing creates an unexpected refund from a return that originally showed a balance due or showed application of the overpayment forward to 2026 (for example, the IRS adjusts underpayment interest, or locates estimated tax payments that weren’t reported).

What the taxpayer needs to do:

You generally have two options:

1. Add/update direct deposit: Follow the notice instructions to sign in to your IRS Individual Online Account (often via ID.me) and enter your banking information. The IRS cannot take or change banking information over the phone or in person.
2. Do nothing: The IRS generally issues a paper refund check about 6 weeks after the CP53E notice date