IRS Direct Deposit Fail

Here’s a story… I eFiled my Federal taxes on March 9th with instruction to direct deposit my rather large refund. While patiently waiting for the deposit to hit my bank account, on April 3rd I received a check for the full refund in the US Mail. Since I use an online bank this was quite annoying. I was not willing to put the large check in the mail. I ended up having to drive quite a ways to my “local” Fidelity office to make the deposit.

But that’s not the end of the story. Yesterday, April 11th, I received a notice in the mail from the IRS. It says:

We had to do some additional processing on your tax return. Therefore, we weren’t able to honor your request for direct deposit…and are sending you a check instead. …you should receive a refund check in the mail in 3-4 weeks.

Well, at least I got the refund check a week before this letter, not 3-4 weeks after. But seriously, what the heck is “additional processing” supposed to mean? I double checked, and the direct deposit instructions were correct.

I don’t have an answer for your “additional processing” question, but as for having to drive to deposit a check, doesn’t Fidelity have electronic check deposit on their app? I use Schwab and the closest office is also over an hour away. However, the app lets you deposit a check just by taking a picture of the front and back and entering the amount. No need to mail the check.


The check was over the limit for mobile deposit with the bank. I kinda assumed it would be for Fidelity too, but honestly, I didn’t check.

As for your other question, I have a friend that works for IRS support and I forwarded your question to him. Here is his response:

Well, this question is hard to answer without opening the taxpayers IRS account and doing some research. I’ve seen a lot of letters to taxpayers stating that they will get a check instead of a direct deposit because the account or routing number was incorrect, but this guy claims his number was correct. Perhaps the bank thought there was Id theft with this customer so they returned the money to the IRS.

I can only make a guess and that is my guess!

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I’ve needed to do electronic deposits on over the limit checks two or three times. In each instance I contacted the CU and they ok’d the deposit, worked their magic in the background, and the checks went through without a problem.


Thanks for asking about it. Not a big deal for me to know (ie, not worth waiting on hold with the IRS). The account and routing numbers were absolutely correct (quadruple checked). The account is open in good standing.

My (similar) guess is that the amount of the deposit was so large that the bank refused it (due to concern about fraud). Now that I mention that, I do need to do a separate post about the large refund.