You have just checked out your IRS transcript and see Code 971 is listed. This can cause some confusion and may even send you into a panic. However, tax transcripts will often contain different codes to relay information to taxpayers. The IRS does much to protect an individual’s privacy and while these codes can initially be confusing, Code 971 is mostly straightforward.
What is IRS Code 971?
Seeing a code listed out on your tax transcript can feel intimidating, but it’s usually nothing to worry about. Code 971 is when the IRS has sent out a letter to inform you that there are going to be changes. This could be in reference to many different possible reasons for this change.
The official meaning is considered Miscellaneous Transactions. This indicates that there are additional reviews being conducted or information needed. In general, the notice will inform you on what needs to be done.
What Does the Amount on Code 971 Line Mean?
If there is an amount on a Code 971 line, this could be in reference to an adjusted return amount. Depending on the different codes that may be included, the IRS may have auto-adjusted your return or will further update you on any changes that are going to be made.
For Code 971, the taxpayer generally does not need to take any action unless it is otherwise stated. Calling the IRS if you have any issues regarding your tax transcript can help you from incurring any penalties, as well as clear up any concerns regarding your tax filing status. View our easy guide to speaking with a live agent at the IRS.
Possible Reasons for IRS Code 971
There are many different reasons for an IRS Code 971 to appear on your tax transcript. The code is simply used as a way to notify you and should not be a cause of concern. If there is going to be any delays, this will be outlined on the transcript. Some reasons include:
- Amended tax return
- Balance transferred to split liability account
- Bankruptcy notification
- Duplicate tax return processed
- Collection due
- Collection due process with a Notice of Intent to Levy is issued
- Duplicate notice sent to a spouse
- Earned income tax filing status
IRS Code 971 vs IRS Publication 971
Publication 971 refers to when a spouse may be relieved of what is due, including taxes and penalties, in relation to a joint tax return. This relief includes innocent spouse relief, separation of liability relief, and equitable relief.
FAQs
Questions about IRS code 971? We have the answers.
Reviews could take anywhere from 45 to 60 days. However, in some instances, reviews could take as long as 120 days.
The IRS has made or is going to make an adjustment and is sending you the transcript with the code as a form of notice. You may later receive another notice with resolution.
