US airlines must now automatically refund canceled flights within 7 days for credit cards, ending the era of forced vouchers and endless customer service calls. The 2024 federal rule defines clear delay thresholds and requires cash refunds even for nonrefundable tickets, marking the biggest consumer protection shift in airline travel history.
The New Federal Refund Rule Explained
The DOT’s 2024 rule eliminates a loophole airlines exploited for years: the voucher-first approach. Under the new requirements, airlines must issue automatic cash refunds for canceled flights within 7 days for credit card purchases and 20 days for other payment methods. No more calling, waiting, or begging for your money back.
The rule also establishes clear definitions for what counts as a significant delay. Previously, each airline set its own standards, creating confusion and inconsistency. Now, domestic flights delayed more than 3 hours and international flights delayed over 6 hours automatically qualify for refunds.
Perhaps most importantly, cash refunds are now required even for nonrefundable tickets if you decline rebooking. Airlines can no longer substitute vouchers without your explicit approval. The rule even extends to extra services. If you paid for Wi-Fi, seat selection, or checked bags that weren’t delivered as promised, those fees must be refunded too.
What Triggered This Policy Shift
The COVID-19 pandemic exposed just how broken the airline refund system had become. When carriers canceled millions of flights in 2020 and 2021, they held onto billions of dollars in passenger money while aggressively pushing travel credits instead of cash refunds.
The DOT was flooded with complaints. More complaints arrived in those two years than in the previous decade combined. Stories of travelers waiting months for refunds, receiving expired vouchers, or being denied money altogether became commonplace. What had been occasional frustrations turned into a national consumer crisis.
Bipartisan pressure from Congress followed. Senate hearings revealed airlines were sitting on enormous sums of customer funds during peak pandemic cancellations. Lawmakers from both parties demanded stronger protections, and the DOT finally acted.
