IRS code 971 on your transcript signifies that a "Notice Issued" has been sent, indicating the IRS is communicating regarding a change, correction, or request for information regarding your tax return. Common triggers include math errors, identity verification, missing documents (W-2s/1099s), or adjustments to credits/deductions, often following a 570 hold.
Code 971 is an IRS transaction code that appears on your tax transcript, not on your tax return. This code simply means that the IRS has sent or is about to send a notice to the taxpayer. It does not always signal a problem.
Key Takeaways: TC 971 will likely be presented on a transcript with one or more other codes to provide further clarity on the outstanding issue. It is common for TC 971 to be accompanied by TC 570, which indicates that the IRS put a hold on processing your refund.
It's important to note that Code 971 does not necessarily indicate that the small business owner has done anything wrong or that there is a problem with their tax return. It simply means that the IRS has made a change to the return, and the business owner needs to review the notice and respond accordingly.
Not usually. Most transcript codes reflect routine processing steps or automated holds. Codes like 570 or 971 mean the IRS paused action or sent a notice, not that a formal audit has started.
More In Forms and Instructions
Publication 971 explains when a spouse may be relieved of tax, interest, and penalties on a joint tax return. Three types of relief are available to married persons who filed joint returns: Innocent spouse relief. Separation of liability relief.
If you fail to respond to an IRS Code 971 notice by the deadline, you could face penalties and interest. For example, the IRS may apply a late payment penalty of 0.5% per month (up to 25% of the unpaid tax), along with interest charges based on the federal short-term rate plus 3%.
Confusion about levy blocks and delays in IRS automated collection processes. A tax period blocked from the automated levy program means IRS collection actions are paused for that timeframe. This can occur due to disputes, pending payments, or review requests.
A 971 Notice Issued means the IRS sent you a letter, likely for an update or review. Since the amount is $0, it's usually informational. Check your IRS account or wait for the letter to see details. If nothing arrives in 10 working days, call the IRS.
Area Code 971 covers northwestern Oregon, including Salem and the greater Portland metropolitan region. Introduced as an overlay to 503 in 2000, 971 accommodates the growing demand for phone numbers in one of Oregon's most vibrant corridors.
IRS Transcript can update as many times a day. Where's my refund only updates once a day. Also IRS Transcript is live, so if the IRS is working on your tax return it will reflect same time same day.
IRS transcript codes 570 and 971 relate to identity verification processes. Code 570 indicates a pending identity verification, while 971 confirms the IRS has received verification information. The date 03/24/2025 likely represents a future deadline or expiration for the verification status.
Code 570 on your tax transcript indicates that your tax refund processing has been delayed. This can be for any number of reasons, from a discrepancy in reported income to identity verification. Claiming certain tax credits, such as the EITC, may also delay your refund.
971 means The 971 IRS code listed on a tax transcript indicates there will be changes involving their tax return. Tax code 977 on your online transcript typically indicates that your tax return is being reviewed or examined by the IRS.
766 is the IRS code for an offset reversal. When there is an offset reversal, you have an unexpected tax return check, or the IRS has detected you are due a larger refund due to a child care credit, overpayment, or other error.
Check Your Transcripts
This doesn't necessarily mean that there is anything wrong with your return, but you may receive a request for additional information – including a request to verify your identity. Once the IRS has sent a notice or letter asking you for additional information, you may see a code 971.
IRS Code 971
That code means the IRS has sent a letter or notice requesting additional information. Keep an eye out in your mail for an official letter from the IRS.
If your employees see the word “blocked” on their pay stubs, it means their federal income tax withholding has been stopped or paused. In other words, no federal income tax is being deducted from their paycheck.
Code 971 - "Request for replacement refund" - This is triggered sometime after a Form 3911 (Taxpayer StatementRegarding Refund) is filed. This Form is filed when the taxpayer asserts that the check the IRS sent them went missing.
Not reporting all of your income is an easy-to-avoid red flag that can lead to an audit. Taking excessive business tax deductions and mixing business and personal expenses can lead to an audit. The IRS mostly audits tax returns of those earning more than $200,000 and corporations with more than $10 million in assets.
The 971 code indicates that the IRS has sent you a letter regarding changes that they are making to your return. There isn't anything for you to do other than just wait for the letter to arrive. Does 971 code always means a letter has been issued or is it broad ? It does not have a $ value associated.
How to address an IRS audit
The IRS audit envelope will arrive via certified mail and list your full name, taxpayer ID or social security number, the form number, and the Information they are reviewing. It will also provide the IRS agent's contact information for more information or questions on the process or specific case.
Innocent spouse relief can relieve you from paying additional taxes if your spouse understated taxes due on your joint tax return and you didn't know about the errors. Innocent spouse relief is only for taxes due on your spouse's income from employment or self-employment.