Proposed Rule to Tighten and Shift Paper Check Exceptions for Federal Payments
AI-generated summary for informational purposes only. Not legal advice. See the original source for the authoritative text.
This proposed rule pushes federal payments further toward electronic transfer and narrows the situations where agencies can still issue paper checks. It would also move responsibility for deciding many individual hardship exceptions from Treasury to the paying agencies, while adding new agency-level waiver options for foreign payments, disaster cases, certain military operations, and payments on Indian land without the needed infrastructure. For federal agencies, the practical change is more paperwork control and more reporting: they would have to confirm an exception exists before certifying a paper check and report waiver activity to Treasury. For payment recipients, especially older people, people with access barriers, and some tribal communities, the rule could reduce paper-check access unless an agency grants an exception. Comments are due June 15, 2026.
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Key Changes
- Moves many hardship waiver decisions from Treasury to the paying agency
- Eliminates some old paper-check exceptions and keeps only narrower waiver paths
- Adds new waiver categories for Indian land, foreign payments, disasters, and some military or emergency cases
Obligations
What this law requires
Federal paying agencies must confirm that an applicable exception applies before authorizing a paper check payment instead of electronic funds transfer.
Federal paying agencies must confirm that an applicable exception applies before authorizing a paper check payment instead of electronic funds transfer.
Federal paying agencies must adjudicate individual hardship waiver requests in accordance with Treasury-issued guidelines, rather than Treasury adjudicating those requests directly.
Federal paying agencies must adjudicate individual hardship waiver requests in accordance with Treasury guidelines, rather than Treasury making those determinations directly.
Federal paying agencies must provide Fiscal Service with compliance reporting under part 208, including information on waiver requests approved and rejected when requested or required by the rule.