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Why you received IRS notice CP53E and how to respond

Published on April 28, 2026
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Holly Cushman CPA Shareholder
  • Article
IRS laptop notice

What Is IRS Notice CP53E and Why Did I Receive It?

IRS Notice CP53E is an official letter sent when the IRS is unable to deposit a federal tax refund directly into a bank account. This can occur for one of the following reasons:

  • The financial institution rejected the refund due to an invalid bank account number.
  • No bank account information was provided on the tax return.
  • The bank account could not be validated by the IRS.

This year there has been a noticeable increase in CP53E notices. This surge is related to an Executive Order requiring all federal disbursements, including tax refunds, to be issued electronically.

What Should I Do After Receiving IRS Notice CP53E?

1. Understand Why You Received the Notice

  • If you were expecting a refund and either did not provide banking information or provided inaccurate information, the notice is expected.
  • If you owed tax with your 2025 return or elected to apply a 2025 overpayment to your 2026 taxes, you may still receive this notice if your return included an underpayment of estimated tax penalty.
    • The IRS’s calculation of this penalty can vary based on when payments are credited. We have seen differences as small as $1 trigger this automated notice.

If you believe the banking information provided on your return was accurate, we recommend contacting your financial institution to determine why the direct deposit was rejected.

2. Take Action—or Don’t

Taxpayers have two options:

  • Update your banking information through your IRS Online Account, or
  • Take no action and wait approximately six weeks for a paper check to be issued by mail.

Please note that most taxpayers do not currently have an IRS Online Account and would need to create one in order to update banking information electronically.

3. Avoid Scams

Be cautious of fraud. A legitimate CP53E notice will instruct you to update banking information only through your IRS Online Account. IRS employees cannot update bank information over the phone. QR codes or web links are only legitimate if they direct you to IRS.gov/Account.

If you have questions or would like assistance reviewing your notice, contact us.