IRS Transcript Shows $5,695 Negative Balance After Code 291 Tax Reduction of $7,812 - What Does This Mean for My Refund?

My transcript is showing a balance of -$5,695.00 with a recent code 291 from November 4, 2024 that reduced my tax assessment by -$7,812.00. I'm confused about what this means for my refund status. Here's what my transcript shows: ACCOUNT BALANCE: -5,695.00 ACCRUED INTEREST: 0.00 AS OF: Nov. 04, 2024 ACCRUED PENALTY: 0.00 AS OF: Nov. 04, 2024 ACCOUNT BALANCE PLUS ACCRUALS (this is not a payoff amount): -5,695.00 INFORMATION FROM THE RETURN OR AS ADJUSTED: EXEMPTIONS: 02 FILING STATUS: Head of Household ADJUSTED GROSS INCOME: 19,171.00 TAXABLE INCOME: 0.00 TAX PER RETURN: 7,812.00 SE TAXABLE INCOME TAXPAYER: 24,329.00 SE TAXABLE INCOME SPOUSE: 0.00 TOTAL SELF EMPLOYMENT TAX: 3,723.00 RETURN DUE DATE OR RETURN RECEIVED DATE (WHICHEVER IS LATER) Apr. 15, 2023 PROCESSING DATE Mar. 18, 2024 TRANSACTIONS: CODE EXPLANATION OF TRANSACTION | CYCLE | DATE | AMOUNT 150 Tax return filed | 20240905 | 03-18-2024 | $7,812.00 76221-438-96765-3 806 W-2 or 1099 withholding | | 04-15-2023 | -$462.00 810 Refund freeze | | 02-16-2023 | $0.00 766 Credit to your account | | 04-15-2023 | -$9,417.00 766 Credit to your account | | 04-15-2023 | -$12,451.00 971 Amended tax return or claim forwarded for processing | | 03-05-2024 | $0.00 977 Amended return filed | | 03-05-2024 | $0.00 33277-471-00650-4 767 Reduced or removed credit to your account | | 04-15-2023 | $12,451.00 767 Reduced or removed credit to your account | | 04-15-2023 | $9,417.00 766 Credit to your account | | 04-15-2023 | -$1,500.00 764 Earned income credit | | 04-15-2023 | -$3,733.00 291 Reduced or removed prior tax assessed | | 11-04-2024 | -$7,812.00 19254-689-05216-4 I'm seeing a lot of back and forth with credits being added and removed on April 15, 2023. There were credits of -$9,417.00 and -$12,451.00 that were added but then later removed on the same day with code 767. I also see credits for earned income credit (code 764) of -$3,733.00 and another credit (code 766) of -$1,500.00. There's W-2/1099 withholding (code 806) of -$462.00 too. My original tax per return was $7,812.00, filed as Head of Household with 2 exemptions. My adjusted gross income was $19,171.00 with self-employment taxable income of $24,329.00 and total self-employment tax of $3,723.00. I filed an amended return (codes 971 and 977) on March 5, 2024, and there was a refund freeze (code 810) back on February 16, 2023. My current account balance shows -$5,695.00 with no accrued interest or penalties as of November 4, 2024. The most recent transaction is code 291 from November 4, 2024 that completely removed my prior tax assessment of $7,812.00. I'm not sure what this means - does this negative balance mean I'm getting a refund of $5,695.00? Can anyone help explain what these transaction codes mean, especially the recent 291 reduction, and what happens next with my account?

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15 comments

Oliver Brown

•10M

The transcript shows a detailed history of tax adjustments resulting in a refund due of $5,695.00. The most significant change is the recent code 291 from November 4, 2024, which completely reversed your original tax assessment of $7,812.00. This reversal appears to be a result of your amended return (codes 971/977) filed on March 5, 2024. Your original return shows you filed as Head of Household with 2 exemptions, reporting self-employment income of $24,329.00 with self-employment tax of $3,723.00. While your adjusted gross income was $19,171.00, your taxable income was reduced to $0.00. There was significant activity on April 15, 2023, including temporary credits of $9,417.00 and $12,451.00 that were later reversed same-day. The permanent credits on your account include: - Earned Income Credit: $3,733.00 - Additional credit: $1,500.00 - W-2/1099 withholding: $462.00 A refund freeze (code 810) was placed on February 16, 2023, but with the recent tax assessment reversal and no current penalties or interest showing, you should expect to receive the $5,695.00 refund unless there are other outstanding holds on your account.

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Ava Kim

•5M

Code 291 is actually great news for you! It means the IRS has completely reversed your original tax liability of $7,812. This typically happens when an amended return is processed and they determine you didn't actually owe that tax in the first place. Your negative balance of $5,695 does indeed mean you have a refund coming. Here's the breakdown: - Original tax owed: $7,812 - Credits applied: $5,695 (EIC + other credits + withholding) - After code 291 reversal: $0 tax owed - Refund due: $5,695 The refund freeze from 2023 appears to be cleared since there's recent activity. You should see your refund within 2-4 weeks of the November 4th adjustment, assuming no other holds exist on your account. Keep monitoring your transcript for any deposit codes (846) which will show when it's actually sent out.

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