Find out What Happens When Your Tax Return is Rejected with IRS reject code IND-046-01
Is your tax refund held up? When you check the status of your tax return using the “Where’s My Refund” free tool, does the application return with Code 570? Code 570 appears if your refund is delayed while the IRS reviews your tax returns. You may see code 570 for many different reasons, including math errors, missing documentation proving you qualify for tax credits, or even an incorrect, duplicate, or missing Social Security or tax ID number.
The code may also appear if you tried to claim the Earned Income Tax Credit after it was disallowed in the past. The IRS should send you a letter requesting additional information to prove your eligibility for the credit. If you previously tried to claim the Earned Income Tax Credit and it was disallowed, you must file IRS Form 8862, Information to Claim Certain Credits After Disallowance.
Often, the IRS will detect that you are missing Form 8862 as soon as you e-file your tax returns. At this point, you or the tax preparer e-filing your returns will see IRS reject code IND-046-01 pop up on the screen. You will need to attach Form 8862 to your electronic returns and then resubmit your tax returns.
What Is IRS Form 8862?
IRS Form 8862, Information to Claim Certain Credits After Disallowance, is required to claim the EIC, the Child Tax Credit and a variety of other fully or partially refundable tax credits offered to many families. If you see IRS reject code IND-046-01, Failure to File Form 8862, you need to file Form 8862 with your tax returns before the IRS automated system will accept them to process your refund.
Find out exactly how to file Form 8862 depending on the tax credit you’re claiming here.
Reasons for Disallowance
Your EITC claim may have been denied or disallowed in the past for a number of reasons:
· Someone else, such as a spouse, co-parent, or former spouse, may have already claimed a qualifying child on their tax return
· Your child may not qualify under your tax return, either based on residency requirements, age, relationship, or your child claimed the EITC on a joint return with someone else
· You didn’t meet or you exceeded income requirements
· You tried to claim the EITC but are married, filing separately
Why You Need to File Form 8862
If your EITC claim was previously disallowed after 1996 for any reason other than a math or clerical error, you’ll need to file form 8862 to claim the EITC credit on current tax returns. Once you’ve been reinstated to receive the EITC or other tax credits, you’ll receive a CP74 notice from the IRS. You should receive your refund within six weeks after receiving that letter.
Claim the Tax Credits You Deserve
The Earned Income Tax Credit – EITC – is an important tax credit designed to help low- to moderate-income working families meet expenses, pay down debt, or take steps to lift themselves out of poverty. Claiming the EITC may increase your odds of an IRS correspondence audit, according to the Bipartisan Policy Center, a non-profit think tank, or slow down processing of your tax return.
That’s why it’s important to ensure you’re providing all the proper documentation, including Form 8862, when you file your returns. If you do receive an IRS letter for a correspondence audit, don’t panic. Simply provide the agency with the documentation it needs, and you should receive your refund within six to eight weeks.
There’s no reason to leave money on the table – money that is rightfully yours – just because of some added paperwork. Tax professionals are here to help you file correctly and accurately to avoid an IRS audit and receive your tax refund in a timely manner.
If you are facing past-due tax debt, let Alleviate Tax help you with various strategies to settle your debt for less than you owe and minimize your tax losses in the future.
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Why is IRS asking for Form 8862?
The IRS requests form 8862 if you have previously been disallowed the Earned Income Credit (EIC), Child Tax Credit (CTC), Other Dependents Credit or American Opportunity Tax Credit and claimed one or more of these credits on your current return. You’ll need to file form 8862 proving your eligibility to claim the credit.
Do I have to file form 8862 every year?
You need to file form 8862 if you have been disallowed the Earned Income Tax Credit, Child Tax Credits, or other credits at any time since 1996 and are now claiming one of these credits. You only need to file Form 8862 once. The IRS will send a CP74 Notice to reinstate your eligibility, and you don’t have to file form 8862 again unless you are denied the credit again in the future.
