Digital Nomad

Modern Payment Trends & IRS’s Paper-Check Phase-Out: Digital Nomads Take Note

The IRS is phasing out paper checks and expanding digital payment channels beginning 2025-2026—impacts those who live and work abroad or lack U.S. banking ties.

By NomadicTax Research Team • 5-8 min read • February 21, 2026

## What the IRS is Changing with Payments Under Executive Order 14247 The Executive Order “Modernizing Payments To and From America’s Bank Account” is driving several major changes. As of late 2025, the IRS has begun reducing reliance on **paper checks** for refunds and government agencies. By *September 30, 2025*, tax refunds by paper check are no longer issued; incoming and outgoing payments are being transitioned to **electronic methods**. Mail-based checks and money orders will phase out except in exceptional cases. EFTPS enrollment for individuals was closed Oct 17, 2025. ([irs.gov](https://www.irs.gov/newsroom/questions-and-answers-about-executive-order-14247-modernizing-payments-to-and-from-americas-bank-account?utm_source=openai)) Effective more broadly in **late 2026**, individuals will be fully required to use electronic payment methods in many respects. Check payments are still allowed for now if hardship or legal requirement, but the shift is well underway. ([irs.gov](https://www.irs.gov/newsroom/questions-and-answers-about-executive-order-14247-modernizing-payments-to-and-from-americas-bank-account?utm_source=openai)) ## Why This Matters for Digital Nomads, Un-banked Individuals & Remote Workers - **Foreign-based workers** who get refunded via checks may face impossible delivery delays. U.S. bank account access or digital wallet options become essential. - **Individuals without bank accounts (unbanked)** will be urged to open accounts; cash payment options via retail partners like Vanilla Direct may help—but limited. - **Remote freelancers reporting income from U.S. sources**: ensuring payment methods support electronic transfers and direct deposit important, as paper methods diminish. --- ## Steps Digital Nomads Should Take Now 1. **Obtain or maintain a U.S. bank account** or access to one that supports direct deposit. If you lack one, explore low-cost U.S. banking solutions or partnerships that support remote access. 2. **Use IRS Online Account or Direct Pay**: create your Individual Online Account; direct payments and filing options exist. These platforms are increasingly central. ([irs.gov](https://www.irs.gov/newsroom/prepare-to-file-in-2026-get-ready-for-tax-season-with-key-updates-essential-tips?utm_source=openai)) 3. **Track deadlines for check phase-out**: no more paper refunds after September 30, 2025. Plan for future tax seasons accordingly. 4. **Ensure Social Security or ITIN issues sorted**: valid SSN or ITIN required for certain credits; missing numbers will block eligibility even if the rest of the forms are in order. ([irs.gov](https://www.irs.gov/newsroom/prepare-to-file-in-2026-get-ready-for-tax-season-with-key-updates-essential-tips?utm_source=openai)) 5. **Retain receipts and confirmations for electronic payments**: many tools give instant confirmation; these are essential for disputes, reporting, or audit. Keep them secure and accessible. --- ## Example Scenarios - **Remote software developer living abroad** expects a refund from 2025 taxes—no paper check; must ensure valid U.S. bank account or partner institution that handles direct deposit. - **International digital artist** selling via U.S. platform, receiving payments via checks—should request electronic methods now to ensure future compliance and avoid delays. - **Nomadic blogger** without U.S. bank: explore debit card + digital wallet methods, or services offering IRS payment acceptance via retail networks (Vanilla Direct, etc.). --- ## Summary The path toward fully electronic payments is irreversible. Digital nomads and remote workers should early establish banking infrastructure compatible with U.S. systems. Ensure SSNs/ITINs are valid if claiming benefits. Prioritize electronic filing and payments. These steps now prevent setbacks later. **Bottom Line:** Paper is becoming obsolete. Build systems and habits that work with electronic channels to stay ahead and comply smoothly.