TC 570 means the IRS has put a temporary hold on your account or tax refund for review, while code 971 means the IRS has sent you a letter explaining the 570 hold. One of the biggest misconceptions is that seeing a 570 means you’re being audited. It’s especially unnerving because the notice doesn’t even reveal why your tax refund is being delayed.
While receiving this notice isn’t an official audit, it might be a sign that you need to dig into your tax transcripts to ensure you’re compliant. The goal of this blog post is to explain which situation applies to you and what you can do about it. If you’d like additional guidance, contact Wiggam Law today for representation with tax problems.
Key Takeaways
- Code 570 - The IRS has placed a hold on the processing of your tax refund or frozen your tax account.
- Code 971 - The IRS has sent you a letter explaining why it placed your tax account or refund on hold.
- Codes 570 and 971 together – The IRS likely sent a tax notice or letter explaining the tax refund hold; in many cases, these are routine issues that are easily handled.
- When to worry – In some cases, seeing Code 971 right after Code 570 can indicate a possible tax problem, such as a tax liability, refund offset, missing tax return(s), or an upcoming audit.
- The need for professional tax help – Transcript Codes 570 and 971 that reflect more serious issues may require the assistance of a tax professional to better understand what’s going on and figure out how to respond best.
What Does IRS Code 570 Mean?
Transcript Code 570 means the IRS has placed a hold on your account or processing of your tax refund while reviewing something - a credit check, a mismatch, or an identity verification. There are numerous reasons the IRS might do this, many of which are minor issues, including:
- The IRS is conducting a manual review of your tax return.
- Your reported wages don’t match the amount your employer reported.
- The IRS needs to verify your identity.
- The tax credits you reported, such as Earned Income Tax Credit (EITC) or Child Tax Credit, don’t match what the IRS has on record.
- You filed for an Injured Spouse Allocation using Form 8379.
- Duplicate or amended return filings.
Some additional triggers that are showing up for the 2026 filing season include:
- OBBBA “No Tax on Overtime” and “No Tax on Tips” deductions: If you claimed any of these two deductions, the IRS may pause your return to verify your employer reported a corresponding tip or overtime hours correctly. A mismatch between what your employer reported and what you claimed can trigger a 570.
- Form 1099-DA cost-basis mismatches: Form 1099-DA reporting: As digital asset broker reporting expands, the IRS now receives more detailed information about cryptocurrency transactions, initially focused on gross proceeds. If the proceeds reported on your tax return don't match what brokers report to the IRS, your return may require additional review.
Understanding these common scenarios can help you prepare the proper documents (if needed) and promptly respond to the IRS's requests, helping process your tax refund faster.
What Does IRS Code 971 Mean?
When paired with Code 570, Transcript Code 971 indicates the IRS has mailed a notice regarding your account; this may explain why your tax refund was withheld. Unfortunately, you’ll have to wait until the notice arrives to see why the IRS is withholding your refund. For most tax cases, this letter or notice will:
- Explain why the IRS is delaying the processing of your refund;
- Identify the additional information the IRS needs from you to resume processing your tax return;
- List the reasons for any adjustments to your tax return; and/or
- Describe what else you need to do before you receive your tax refund.
What Do Codes 570 and 971 Mean When Taken Together?
If you see Codes 971 and 570 on your tax transcript, but 570 showed up first, it may indicate that the IRS has placed a hold on your account. document should arrive soon explaining the situation. Seeing this can be stressful because you have to wait until you receive the letter to know what’s going on.
When it’s nothing to worry about
For the majority of taxpayers, seeing Codes 570 and 971 together isn’t a big deal because it relates to a routine issue, like identity or income verification. You’ll wait for the notice to arrive, respond to it by the listed deadline, then wait for the IRS to lift the hold and process your return and refund. It’s a nerve-wracking process, but it’s not a major concern.
When they predict a real tax problem
Sometimes, the combination of Codes 570 and 971 serves as a warning sign that you shouldn’t ignore. It could be the first step of an escalating tax situation, such as:
- Owing a tax balance. Your tax transcript might reflect a balance due rather than a pending refund.
- A tax offset. The IRS plans on using your tax refund to pay a tax debt or non-IRS debt. This could indicate an outstanding child support payment or an unpaid tax problem. You’ll know the IRS is planning on using your tax refund if you receive TC 826 or TC 898.
- Unfiled tax returns. If the IRS believes you have missing tax returns, they might hold your tax refund until you resolve the unfiled returns.
- Additional codes appear. There may be additional codes on your tax transcript, depending on the specific tax issue. For example, if you see Code 290, it means the IRS assessed additional tax on your account, and if you see Code 420, an audit might be coming your way.
An Overview of What IRS Codes 570 and 971 Mean
| Probably Routine | Possibly a Problem |
|---|---|
| Code 570 appears, along with a pending refund balance. | Codes 570 and 971 appear along with the transcript, indicating that a tax balance is owed. |
| The hold automatically clears after a few weeks. Code 571 often appears to reflect the lifting of Code 570. | The hold remains for several months. |
| No other issues arise, and you don’t see other tax codes on your transcript. | Additional codes appear that relate to tax issues, such as additional taxes owed (Code 290), refund offset (Code 826), or an incoming audit (Code 420). |
| Code 570 appears with Code 971, and the IRS notice or letter simply asks the taxpayer to confirm their identity. | The IRS asks the taxpayer to verify their income. |
How To Respond to Codes 570 and/or 971
Knowing how to respond will depend on the letter or notice you receive. In most situations, you’ll have three possible courses of action:
- Do nothing. The letter tells you what’s going on, but doesn’t require you to do anything besides be patient.
- Respond to the letter. The letter should explain the issue and ask you to do one or more things. Often, these are straightforward and require you to submit copies of documents you already have or provide information.
- Get help dealing with the letter. If you don’t understand the letter or disagree with what’s contained in it, it’s probably a good idea to talk to a tax professional.
Why You Should Contact Wiggam Law
If you were expecting a tax refund but instead saw TC 570 on your transcript and don’t understand why, it may be time to consult with a tax professional at Wiggam Law.
We have reviewed countless tax transcripts, so we generally know when a tax transcript code is harmless or could indicate a future tax collection enforcement action (such as liens and levies) or an incoming tax examination.
In these latter situations, we’ll explain what’s going on and help you decide what to do next. If necessary, we can also help with the tax negotiation process, such as resolving tax debts or completing an audit. To get started, call us at (404) 609-1300 or use our online contact form.
Frequently Asked Questions (FAQs)
Here are the common questions we get on IRS Code 570 and 971:
Is IRS Code 971 bad?
It depends on the IRS’s reason for sending out the notice or letter. Code 971 only indicates that the IRS sent (or will be sending) a document to you following the TC 570 that appeared in your transcript earlier. For example, the letter could indicate that you owe a higher tax balance, or it could simply say that the IRS needs you to verify your identity. You’ll only be sure when the letter arrives.
What does it mean if both 570 and 971 codes are on my transcript?
It most likely means the IRS has delayed processing your return and sent you a notice explaining the cause of the delay. That notice should also let you know what you can do to resolve the delay.
What should I do if I saw the 971 code, but never got a letter?
You may be able to access an electronic copy of the letter or notice through your online IRS account.
How long does a 570 hold last?
It’s impossible to say, as it depends on why there’s a hold and how busy the IRS is processing returns and other tax matters. That said, if the hold is due to the IRS requiring you to do something, the sooner you respond to the IRS request, the shorter the hold will be.
Sources
- https://www.taxpayeradvocate.irs.gov/news/tax-tips/identity-verification-and-your-tax-return/2026/03/
- https://www.taxpayeradvocate.irs.gov/news/nta-blog/nta-blog-transcripts-pt2/2021/10/
- https://www.taxpayeradvocate.irs.gov/news/nta-blog/nta-blog-understanding-tax-account-transcripts-part-one/2022/09/
- https://www.taxpayeradvocate.irs.gov/get-help/refunds/held-or-stopped-refunds/
- https://www.irs.gov/businesses/understanding-your-form-1099-da
- https://www.irs.gov/newsroom/one-big-beautiful-bill-act-tax-deductions-for-working-americans-and-seniors
Jason Wiggam
Founding Partner
Jason is a founding partner of Wiggam Law in Atlanta, Georgia. His practice focuses on representing individuals, businesses, officers, directors, shareholders, and partners in matters concerning the Internal Revenue Service (IRS), the Georgia Department of Revenue, and other state tax departments. He has successfully represented clients in the IRS’s recent crackdowns on syndicated conservation easements and micro-captive insurance disputes. Jason also has significant experience handling IRS tax settlements, tax compliance, appeals representation, offshore foreign bank reporting compliance, audit representation from responding to IRS audit letters through to IRS audit reconsiderations if necessary, innocent spouse relief, IRS levy and IRS garnishment releases, penalty waivers/abatements, and lien releases/withdrawal.
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