What Does Code 570 And 971 On A Tax Transcript Mean?
What Does Code 570 And 971 On A Tax Transcript Mean?
The IRS codes 570 and 971 may appear on your tax transcript when the IRS has initially accepted your tax return. These transaction codes inform the taxpayer about the status of their tax returns being processed, if there will be any potential delays, and if there will be changes to a tax refund amount.
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Key Takeaways:
- The IRS codes 570 and 971 appear on your tax transcript to inform you about the status of your tax returns being processed, if there will be any potential delays, and if there will be changes to the tax refund amount.
- IRS code 570 indicates a hold on your account that is preventing your tax refund from being processed. IRS code 971 provides additional information regarding the status of your tax return. When these codes are presented together, this means the IRS has sent a notice regarding delays in their tax return.
- IRS code 570 may appear on your account if there are discrepancies between the wages reported by your employer and those listed on your tax return, to verify your identity, if the claimed stimulus payments do not match IRS records, or if the claimed tax credits do not match IRS records.
- A $0.00 amount listed next to code 570 or code 971 on your tax transcript can indicate the issue involving your tax return is non-monetary, whereas a positive dollar amount listed on these lines indicates an update of your tax liability.
- IRS code 571 or 572 with the same date as code 971 indicates the tax return is processed and the tax refund should be received within 3-6 weeks. Different dates between these codes usually indicate a delay in the release of your refund. Code 846 indicates the tax refund has been released and the money is on its way.
What Is Code 570 and 971 on Tax Transcript?
If you observe IRS code 570 and IRS code 971 on your tax transcript, this means that the initial processing of your tax return has been completed.
IRS Code 570
IRS code 570 indicates that there is a hold on your account preventing your tax refund from being processed by the IRS. Sometimes the IRS will contact you to request additional information, and other times you will not need to take any action while you wait for your return to be processed.
IRS Code 971
IRS code 971 provides the taxpayer with additional information regarding the status of their tax return. In the case that TC 971 appears directly after code 570 on your tax transcript, this means that the IRS has sent a notice regarding the issues that are delaying the processing of your tax return.
Why Is Code 570 On Your Tax Transcript?
There are several reasons code 570 may appear on your tax transcript to indicate a delay in the processing of your tax return. Some of these include:
- Discrepancies between the wages reported by your employer and the amounts listed on your tax return
- The need for further identity verification
- Tax credits, such as the Earned Income Tax Credit (EITC), American Opportunity Tax Credit, and Child Tax Credit, do not match the IRS records
- Stimulus payments do not match the IRS records
What Are The Amounts Listed Next To Code 570 And Code 971 On Your Tax Transcript?
The amounts listed next to code 570 and code 971 on your tax transcript can indicate changes to the money involved with your tax payments and tax refunds. If you observe a $0.00 amount next to these lines, this indicates the issue involving your tax return is non-monetary and will not increase your tax liability. If there is a positive dollar amount listed on these lines, this indicates an update of your tax liability.
How To Tell When The IRS Review Process Is Complete
The IRS will apply code 571 or code 572 to your tax transcript once the issue regarding your tax return has been resolved and it is once again being processed. If you see these codes, it is likely that another code 971 will be issued informing you that the IRS has sent another update notice about the status of the review. If the dates beside code 571 or 572 are the same as code 971, your tax refund will likely be received within 3 to 6 weeks. A different date next to these codes typically indicates a delay.
The IRS will apply code 846 to your tax transcript if your refund has been released and should be received shortly.
What To Do If You Disagree With The IRS Assessment
There is nothing you can do to speed up the process of the IRS reviewing your tax return. However, if you disagree with the IRS decision following their code 570 review, you can either contact the Taxpayer Advocate Service or speak with a CPA to investigate the issue.
If you need help with your taxes, consult with the professionals at Ideal Tax for the answers to your tax questions today.
