In March 2025, a new Executive Order required all federal tax payments and refunds to be made electronically starting later this year. It will change the way many of us pay our quarterly tax estimates, tax return payments and how we receive our tax refunds.

What are the New Requirements and When Do They Go into Effect?

Effective Date – The Executive Order is effective for tax refunds and payments as of September 30, 2025.

All tax refunds will be issued electronically. You can no longer request that your tax refund be sent to you via check. All refunds will be made via direct deposit to the bank account information that you provide when filing your return.

All tax return and quarterly estimated payments must be paid electronically. Mailing of tax return payment vouchers or quarterly estimated tax payment vouchers with checks will no longer be allowed.  All payments must be made via electronic submission.

How Does This Impact Me and How Can I Prepare for These Changes? Over the past several years, the IRS has increased the electronic payment mandate for many types of taxes, and this new Executive Order extends those mandates to individuals too.  Fortunately, the IRS provides multiple options for you to securely process the required electronic transactions.

Receiving electronic tax refunds. Whether working with a tax professional to file your tax return or preparing your tax return yourself using an online tax software program, you have likely seen the option to provide or input your bank information to receive a direct deposit of your tax refund. Alternatively, you have the option to receive your refund by check via mail.  Under the new policy, you will have to provide your bank information to receive your refund via direct deposit only.

Estimated tax payments and tax return payments. If you are currently mailing in your quarterly estimated tax payment vouchers or tax return payments with a check, you will need to start making those payments electronically after September 30, 2025.

The IRS provides several options for making payments:

No account set-up needed: Direct Pay from your bank account, or Debit card, credit card or digital wallet (fees will apply).

Account set-up required:  Individual Online Account (uses ID.me verification), or EFTPS – Electronic Federal Tax Payment System (new accounts can take up to five business dates to process).

Electronic Funds Transfer (EFT) via tax software program. You may already be making your tax return payments through your tax software program when filing your return by providing your bank information. Some programs may allow you to schedule your estimated payments in advance too. Please call our office with any questions

According to one study, 43% of data breaches involve small businesses. Another study found that the average cost of a data breach incident for a company with fewer than 500 employees is $2.98 million.

Business owners are required to protect their customers’ personal information. In all 50 states, Guam, Puerto Rico, The Virgin Islands, and the District of Columbia, businesses are required to notify individuals of security breaches involving personally identifiable information.

As evidenced by news of large-scale data breaches, online hacking has become another form of risk that businesses now face every day. Like many risks, businesses can insure themselves against the financial damage a cyber-attack may inflict.

Cyber liability insurance may cover a range of risks, including:

• Data Breach Management: Pays expenses related to the investigation, management, and remediation of an incident, including customer notification, credit check support, and associated legal costs and fines.
• Media Liability: Covers third-party damages such as website vandalism and intellectual property rights infringement.
• Extortion Liability: Reimburses for expenses associated with losses arising from a threat of extortion.
• Network Security Liability: Covers costs connected with third-party damages due to a denial of access and theft of third-party information.

Cyber liability insurance is fairly new, so expect a wide divergence of coverage and costs. It may be purchased separately or as a rider to your current business insurance policy. Be prepared to comparison shop to get a better understanding of coverage and costs.

Small business owners might also keep in mind that “an ounce of prevention is worth a pound of cure.”  There are steps you can take to protect your business from becoming a cyber victim. Consider these steps to protect your data:

1. Maintain robust malware detection software and keep existing software updated.
2. Train employees not to open links contained in emails from unknown senders.
3. Encrypt your important data, such as bank account information, customer credit card numbers, etc.
4. Perform a security audit.

As obvious and simple as these precautions may sound, some businesses fall victim to cyber-attacks because of their failure to take them.