Code 846 on irs transcript 2023

General
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code 846 on irs transcript 2023

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What does code 846 mean on an IRS transcript for 2023?

Answer:
Code 846 on an IRS transcript indicates a refund issued to the taxpayer. This code is used by the IRS to signal that refunds, including overpayments and refundable credits, are released to the taxpayer. When you see this code on your transcript, it means the IRS has processed your refund and it should be on its way to you. Here’s a detailed breakdown:

Detailed Explanation:

  1. Nature of Code 846:

    • Code 846: When this code appears on your IRS transcript, it signifies that a refund has been issued or an overpayment has been approved. This could be because of various reasons such as an overpayment of taxes, refundable tax credits (e.g., Earned Income Tax Credit, Child Tax Credit), or adjustments from previously filed years.

  2. Status of Refund:

    • The appearance of code 846 means your refund has already been processed and approved. If you’re looking for the actual refund date, the code 846 entry will have a corresponding date indicating when the refund was issued.

  3. Amount Refunded:

    • Adjacent to the code 846 entry, you will typically see a dollar amount. This figure represents the total amount that has been refunded to you.

Sample IRS Transcript Entry:

Here’s how code 846 might appear on an IRS transcript:

Code    Explanation of Transaction                          Date        Amount
846     Refund Issued                                       03-15-2023   $1,200.00

In this example:

  • Code: 846
  • Explanation of Transaction: Refund Issued
  • Date: March 15, 2023 (indicating when the refund was issued)
  • Amount: $1,200.00 (the refunded amount)

Steps after Seeing Code 846:

  1. Check Refund Status:

    • Once code 846 appears, you may want to check your refund status via the IRS “Where’s My Refund?” tool or your bank account to confirm receipt of the refund.

  2. Verify Amount:

    • Ensure that the refund amount shown on your transcript matches the amount received. If there’s a discrepancy, you might need to contact the IRS for further clarification.

  3. Follow up if Necessary:

    • If you haven’t received your refund within a week or two after seeing the 846 code, it’s wise to follow up with your financial institution or contact the IRS for more details.

Additional Notes:

  • Delayed Refunds: Sometimes, even when the code 846 appears, you might experience delays in receiving the refund due to bank processing times or other administrative procedures.

  • Future Credits: If you owe any back taxes or have other federal debts, the IRS may apply part of your refund towards those obligations before issuing any remaining balance.

Final Answer:
The presence of code 846 on an IRS transcript for 2023 indicates that a refund has been issued. This code is a positive sign as it confirms that the IRS has processed and approved the refund, providing you with important information regarding the refund amount and date of issue.