Hey there! As a data analyst and tax code expert, I want to help you understand IRS Refund Issue Code 846. I know tax transcripts can be confusing with all those codes and numbers!
Seeing Code 846 on your transcript means your refund has been approved, so let me walk you through everything this code signifies. Consider this your go-to guide for IRS Refund Code 846!
What is Refund Issue Code 846?
In simple terms, Code 846 is the “Refund Issued” code. It appears on your IRS account transcript when the IRS finishes processing your tax return and approves your refund for payment.
This code is like the green light that your refund is on the way!
Specifically, Code 846 indicates:
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The IRS completed reviewing your tax return and verified its accuracy. All good!
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The amount you claimed for your refund has been approved based on your tax situation.
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Payment of the refund has been scheduled, along with any applicable interest.
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The money will be sent to you shortly via direct deposit or mail.
So in essence, Code 846 means your refund has been given the final stamp of approval by the IRS after all processing steps are done. Let the refund celebration commence!
The Path to Seeing Code 846
For Code 846 to show up, your return has to complete quite the journey through IRS tax processing:
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Your personal info is validated – The IRS checks that your SSN, address, bank details, and other info matches their records. No discrepancies, no problems!
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Your tax forms and figures are reviewed – Every line item, credit, deduction, income source, and calculation is verified for accuracy.
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Refund amount is confirmed – The IRS adjusts your claimed refund if needed based on their review and then approves the final amount to send you.
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Possible debts are offset – If you have unpaid federal/state tax bills or certain other debts, your refund will be reduced to cover those first.
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Screening for fraud occurs – IRS systems look for suspicious signs of refund fraud and verify return is legit. Safety first!
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Interest may be calculated – If refund is delayed past a certain date, you may receive interest!
Only after making it through this processing gauntlet will Code 846 be triggered, signaling your refund is cleared for takeoff!
When Will I Get My Refund After 846?
Once that coveted 846 code appears, when can you expect money in hand? The timing depends on whether you chose direct deposit or paper check:
Direct Deposit Refund Timeline
After Code 846 shows up, you can generally expect funds in your bank account within 2-3 weeks. But some banks receive and process the IRS refund deposits faster, so you may see the money in as little as 1-2 days!
I recommend contacting your bank to find out their specific timeframes on IRS refund deposits.
According to IRS data, over 90% of refunds are issued by direct deposit, so chances are you’ll get your money faster going this route!
Paper Check Refund Timeline
If you went the mail route, allow 3-4 weeks for delivery of your refund check after seeing Code 846 on your transcript.
The USPS is fast, but likely not as fast as direct deposit. So paper check refunds take a little longer to land in your mailbox.
Tip: Make sure to look out for an IRS envelope in your mail during this timeframe! Don’t accidentally toss your refund.
Locating Code 846 on Your Transcript
Wondering where to find Code 846 once your transcript is ready?
Look in the section labeled "Transactions". Specifically the "Explanation of Transaction" column.
You‘ll see Code 846 here accompanied by the date it occurred and associated refund amount issued:
Transaction Date: 03/05/2023
Explanation of Transaction Cycle Date Amount
Refund Issued 20230805 $1,350.00This breakdown shows that on March 5, 2023, the IRS scheduled issuance of a $1,350 refund to be transmitted on the August 5, 2023 weekly cycle date.
Pretty straightforward once you know what you’re looking at!
Pro Tip: You can access your transcripts online through your IRS account or have them mailed to you. I‘d suggest going the online route for quick access.
Why You‘ll See "Refund Issued"
When you see Code 846, you‘ll also notice the words "Refund Issued" next to it on your transcript.
This confirms that after the IRS completed all processing and reviews, your refund has been approved and is now scheduled for payment.
Seeing “Refund Issued” is certainly music to your ears! It means:
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Your personal info checks out – The IRS verified your identity, bank account details, address, etc.
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Your return got the green light – Your income, withholding, deductions, and credits were all confirmed accurate.
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Fraud likelihood seems low – IRS fraud filters didn’t catch anything suspicious to hold things up.
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Any debts were handled – If you owed taxes or other debts, they reduced your refund appropriately first.
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You accrued interest if eligible – Late refunds past a date earn you interest!
Essentially “Refund Issued” signals the IRS is satisfied with your return accuracy and has released your refund money for transmittal. Woo hoo!
By the Numbers: IRS Refund Data
Beyond understanding the meaning of Code 846, having some key IRS refund stats can give useful perspective:
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For e-filed returns, the average refund issued is $2,873 (Tax Year 2020)
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For paper-filed returns, the average refund issued is $1,963 (Tax Year 2020)
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The overall average refund processing time is 18 days
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The IRS issues 9 out of 10 refunds in less than 21 days
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The highest refund totals are seen in February-March, during peak tax season
So while refund timing varies on a case-by-case basis, these averages demonstrate most people receive their refund within 2-3 weeks during filing season without issues!
Top Questions About Code 846
You might still be wondering:
How long after I see Code 846 will my refund arrive?
Expect about 2-3 weeks for direct deposit refunds and 3-4 weeks for mailed checks after Code 846 appears on your transcript. But your individual timing could be shorter or longer.
What does Code 846 actually mean?
It means your refund has been approved and scheduled for payment! The IRS will now transmit your money via your requested method.
Can Code 846 show before my return is processed?
Nope, your return must finish processing first before Code 846 can appear. It‘s a final step after all reviews are done.
If I don’t have Code 846 yet, what does that mean?
No Code 846 likely means your return is still being processed. Keep checking periodically for 846 to show up, meaning your refund got approved!
What other "good" IRS codes might I see?
Some other refund-related codes to look for:
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826 – Refund Check Paper Sent
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766 – Credit for Earned Income Credit
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768 – Earned Income Credit
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841 – Refund Cancelled and Reissued
Takeaway on Refund Issue Code 846
I hope this breakdown gives you confidence knowing what Refund Issue Code 846 signifies and how to interpret it!
The key points to remember are:
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Code 846 means your refund passed IRS scrutiny and is approved for payment.
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Direct deposit refunds generally arrive 2-3 weeks after Code 846, checks within 3-4 weeks.
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Look for Code 846 on your "Transactions" section of your transcript.
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"Refund Issued" next to Code 846 confirms your refund is on the way after processing completed.
Seeing that coveted 846 code is certainly cause for celebration, signaling that refund money is soon on its way to you! Virtual high-five! Let me know if any other tax code questions come up. I‘m happy to help explain the IRS transcript puzzle.
