The standard practice for the IRS to handle a returned deposit, because it was sent to a closed bank account, is that he bank sends it back and they change it to a paper check and mail it to the address on the tax return. It's not a new practice, however there were some issues with the second stimulus on the deposit.
If your address on your tax return is correct, there is no need for concern. In a year when so many changes did not take place, the time frame would be anywhere from 4 - 6 weeks.
This year has brought challenges. The IRS is required to reconcile the tax returns and stimulus payments as well as working on the third stimulus payments due to the American Rescue Plan Act (ARPA). With the tax season and the changes taking place all at once, a delay should be expected for full payments. They want to be diligent and are required to follow any protocols they have been issued. They will make any adjustments and additional payments as they complete the process.
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