The Tax Navigator – IRS Rules and Updates Affecting Refunds and Payments

Join Sean Muller, The Tax Navigator, as he breaks down the latest federal updates, including the recently averted government shutdown and new IRS guidance on electronic payments, refunds and the upcoming EFTPS phaseout. He also explores how states are cracking down on taxpayers using Montana LLCs to avoid motor vehicle taxes and highlights growing employer participation in newly introduced Trump accounts for children.

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Detailed Description of The Tax Navigator – IRS Rules and Updates Affecting Refunds and Payments

00:00:00
Sean: All right. So, we did have a partial shutdown.

00:00:02
Sean: But as we’re filming on Tuesday afternoon, Congress has sent a bill to the president to get the shutdown over with and done. So, we expect the president to sign the bill, so we won’t have any problems.

00:00:14
Sean: There wasn’t really anything upsetting in the shutdown this year, or at least this time, because the IRS was requiring all their employees to continue working, and the government was still working.

So, it was a very mild shutdown for what we had in the fall. It looks like that is being averted yet again.

00:00:30
Sean: A few interesting things: the IRS did release a frequently asked questions list, or a fact sheet, about making payments.

We talked a lot about this in September — about the need to make electronic payments — and it was an executive order from last March from President Trump.

00:00:44
Sean: The IRS was not ready to accept payments electronically in all cases, so they’re still allowing you to do paper checks.

00:00:51
Sean: And they’re still working through the issues we’ve already talked about with how a trustee pays the tax for a trust, because you can’t pay that through EFTPS or through an IRS website.

So, they’re still allowing paper checks for these different things. And if you don’t have a bank account, you can still get a paper check.

00:01:10
Sean: But on the refund side, if you have a refund that you’re entitled to, they’re going to process your tax return, and they’re going to mail you a letter and say, “Give us your bank account information,” because they do not want to send you a paper check for that.

00:01:23
Sean: If you don’t have a bank account and you can prove that, then they will send you a check. But otherwise, they’re going to ask for your bank information.

00:01:29
Sean: So, if you’re waiting for that refund check and you haven’t received it, check your mail to see if there’s a notice.

They’re not going to text you or fax you or anything like that. They’re just going to send you a letter. So, if you’re waiting on a refund, that’s what you’ve got to worry about.

00:01:40
Sean: On the payment side, you can continue to make payments by paper check, but we do encourage you to register at the individual level with the IRS and have an account there.

00:01:52
Sean: EFTPS stopped taking applications for individuals in October 2025, and they’re going to phase that system out by the end of 2026 for EFTPS.

As an individual, your only option to make electronic payments is going to be through the IRS website.

00:02:08
Sean: So, we covered that piece on payments and we covered the shutdown.

00:02:11
Sean: An interesting ruling yesterday — or a case that’s come up recently — is that some states are attacking taxpayers who are using the state of Montana to avoid paying motor vehicle sales tax.

00:02:23
Sean: Montana has no sales tax, and they have a very low motor vehicle tax. And so, what taxpayers are doing is they are setting up an entity in Montana with a registered agent, and the Montana LLC is purchasing the car or boat for them, and then they’re driving it around outside of Montana.

A number of states are losing the revenue, and they’re coming out and trying to attack taxpayers and saying, “Hey, your car that’s registered in Montana is driving around Atlanta — we want our taxes.”

00:02:54
Sean: There was actually a court case where a Minnesota car dealership was being charged with evading tax because they were telling all their customers to sell all the cars to a Montana LLC to avoid paying the Minnesota tax.

So, they are chasing down on that.

00:03:13
Sean: On the Trump Accounts that you can set up for children, lots of employers are getting on board now and saying not only are we going to potentially contribute on the employer’s behalf, we’re going to match what the government’s doing.

So, a couple of companies, like JPMorgan, have said, we’re going to match the $1,000 the government puts in for employees’ kids.

00:03:34
Sean: We’ve got to hold off on that. We’re expecting rules to come out on what that means. And we’ve talked previously about some ERISA rules, etc.

00:03:42
Sean: But lots of companies are jumping on board and setting up these Trump Accounts for the purposes of their employees’ kids. So, more to come on that.

00:03:49
Sean: July 4 of this year is the first day that employers can make contributions for that.

00:03:54
Sean: So, that’s about it for this week.

This episode of The Tax Navigator was recorded prior to publication. Some references or updates discussed may reflect information current as of the recording date.