The information in this article is up to date for tax year 2024 (taxes filed in 2025).
Tax preparers often encounter a common issue – how to rectify the reject codes on clients’ returns. Getting a federal rejection can be frustrating if you are unfamiliar with the code’s meaning or how to fix it. This article aims to provide an overview of the most frequent IRS reject codes along with actionable steps to resolve and resubmit the returns efficiently and quickly.
Reject code F8962-070
The reject code F8962-070 indicates that the IRS has information showing that the taxpayer, spouse, or dependent has marketplace insurance and/or has received an advance Premium Tax Credit for marketplace insurance.
To correct reject code F8962-070:
- Add Form 8962 to the taxpayer’s return by either attaching the Form 1095-A(s) they received from the Health Insurance Marketplace or by adding a statement to their tax return explaining why they don’t need to file Form 8962.
Reject code IND-031-04
This reject code indicates that the Adjusted Gross Income (AGI) or the Personal Identification Number (PIN) used to electronically sign the return does not match IRS records.
To correct reject code IND-031-04:
- Verify that you’ve entered the taxpayer’s PIN or AGI correctly. If it was entered incorrectly, update the figure and resubmit the return.
- If the previous year’s tax return was filed late, the IRS may record the AGI as $0 because they may not have fully processed the return amount yet.
- If you do not have access to the taxpayer’s prior year AGI or PIN, or you are confident that you’ve entered both the AGI and PIN correctly, but the return is still being rejected, you will need to file with paper forms and mail in the return. The IRS will not provide additional information regarding the taxpayer’s AGI or PIN if the return continues to receive this rejection.
Reject code IND-452 and IND-515-01
This reject code means the primary taxpayer’s Social Security number (SSN) has already been provided as belonging to the primary taxpayer on another return.
To correct reject code IND-452 and IND-515-01:
- First, verify that the client’s SSN is accurate. If not, correct it and resubmit the return.
- If the SSN is correct, ask the taxpayer if they already filed their return themselves or with another tax preparer. They may have started the return with another preparer who went ahead and filed without their permission. In that case, the return you have prepared will need to be filed using paper forms and mailed in. If the taxpayer has questions, refer them to the IRS Tax Assistance Office at 1-800-829-1040.
Reject code F1040-164-01
Your client may receive this rejection if they claim the Earned Income Tax Credit (EITC) after the IRS disallowed it in a prior year.
To correct reject code F1040-164-01:
- If your client received a letter from the IRS indicating they could once again claim the EITC, complete Form 8862 and retransmit the return.
- If the return is rejected again for a reason related to the EITC, your client may not yet be able to claim the EITC. The IRS advises on steps to take if a claim for EITC is denied. Your client may need to pay back claims (plus interest) before claiming the credit.
Reject code R0000-905-01
This reject code indicates the EFIN used to file the return isn’t in the IRS database or hasn’t been accepted.
To correct Reject Code R0000-905-01:
- Verify that you have entered the correct EFIN in your software setup.
- It’s possible your EFIN is inactive due to an outside circumstance, for example, undeliverable mail. If so, an owner, Responsible Official, or Authorized Delegated User of your firm can make the appropriate updates to your application. To get this issue resolved, log in to your IRS e-Services account or call the IRS E-File Help Desk at 1-866-255-0654.
Reject codes FW2-502 and F1099R-502-02
There are four rejects that contain the number 502, and all are due to a mismatch between the Employer Identification Number (EIN) and the first four letters of the company name on the return. The most common of these rejects relate to either a Form W-2 or 1099-R.
To correct reject codes FW2-502 and F1099R-502-02:
- Verify that both the EIN and the name you entered on the return match the original tax documents and correct them as needed.
- If the information entered on the return matches the tax documents, contact the payer to verify the documents are correct. Get a corrected Form W-2 or 1099-R if possible, or file the return using Form 4852 as a substitute.
Reject codes R0000-500-01 and R0000-503-02
The Social Security Administration (SSA) provides the data that the IRS uses to verify a person’s name and SSN, while the IRS issues ITINs.
Reject code R0000-500-01 indicates a mismatch between the primary taxpayer’s SSN or Individual Taxpayer Identification Number (ITIN) and the first four letters of their last name. Reject code R0000-503-02 is similar but applies to the spouse or secondary taxpayer’s information.
To correct reject codes R0000-500-01 and R0000-503-02:
- Verify your client’s SSN or ITIN and last name spelling on their Social Security card or ITIN card. If the data entered on the return is incorrect, make the corrections and retransmit the return. Note that if your client has multiple middle or last names, the SSA may not be using the correct last name. Generally, database verification system counts the third name in the series as the last name.
- If the primary or secondary taxpayer has notified the SSA that they have changed their name, it may take the SSA up to 10 days to notify the IRS after they have updated their files. Once the IRS’s database has been updated, you can resubmit the return with your client’s new name.
- If the information in the return is entered correctly, but the return continues to be rejected, the return will need to be filed using paper forms and mailed in. It is possible that the SSA may have incorrect information on file. The primary or secondary taxpayer will need to communicate with the SSA to verify and/or correct their information on file. They can call the SSA at 800-772-1213 or check for a local SSA office to assist.
Reject code R0000-504-02
As with the primary and secondary taxpayer, the IRS uses data provided by the SSA to verify the name and SSN. This reject code indicates a mismatch between a dependent’s SSN and the first four letters of their last name. The reject message will indicate the dependent in question, so if the message says, “Additional Information: XXX-XX-1234”, the dependent whose SSN ends in 1234 is the one triggering the reject.
To correct reject code R0000-504-02:
- Verify the dependent’s last name and SSN or ITIN with their Social Security card or ITIN card. If the data entered on the return is incorrect, make the correction and retransmit the return. Note that if the dependent has multiple middle or last names, the SSA may not be using the correct last name.
- If you have verified the information and the return is still being rejected, advise your client to contact the SSA to verify the dependent’s last name. If a correction is required, it may take the SSA up to 10 days to notify the IRS after they have updated their files. Afterward, an electronic return can be resubmitted.
- If the information in the return is entered correctly, you’ll need to file a paper return. Your client will need to contact the SSA to verify and/or correct the dependent’s information on file. They can call the SSA at 800-772-1213 or check for a local SSA office to assist.
Reject code IND-517-01
This code indicates that a dependent on the return has already been included as the primary taxpayer or spouse on another return, but they did not indicate that they were someone else’s dependent. This rejection is common on the returns of parents who are still claiming a young adult who also files their own tax return.
To correct reject code IND-517-01:
- Your client will have to file a paper return, with or without the dependent. If filing with the dependent, the dependent will need to file an amended return indicating they are a dependent on someone else’s return.
- If there is a dispute about the dependency, your client should include documents with the return bolstering their claim.
Reject code R0000-507-01
This reject code indicates a dependent’s SSN provided on the tax return has been used on another tax return. One common scenario for this rejection is when separated or divorced parents both claim their child. It could also occur due to a typing error, but this is uncommon.
To correct reject code R0000-507-01:
- Verify the accuracy of the last name and SSN or ITIN. If the data entered on the return is incorrect, make the correction and retransmit the return.
- If the data is correct, a paper return will need to be filed. Include with the return any documents that will bolster the claim that the taxpayer should be able to claim the child as a dependent (e.g., Form 8332, Release of Claim to Exemption for Child of Divorced or Separated Parents from the custodial parent or a copy of the divorce or separation agreement).
Reject code IND-116-01
This reject code indicates that the Child Tax Credit was claimed for a dependent who is ineligible due to their age (older than 16). This can occur due to a data entry mistake of the dependent’s birth year, or if the IRS has the dependent’s birth year incorrectly listed in its database. The reject message will indicate as “Additional Information” the last four digits of SSN for the dependent in question.
To correct reject code IND-116-01:
- Verify the correct date of birth, and, if it’s incorrect, correct and resubmit the return.
- If the date of birth on the return is correct, you’ll need to mail in a paper return along with supporting documentation.
Reject code F1040X-001
This code applies to a filed Form 1040-X, and it could mean one of four things:
- The filing status on the amended return differs from the original return.
- The original return was not e-filed.
- The original return was not a Form 1040 or 1040-SR.
- The primary taxpayer SSN and/or the spouse SSN don’t match the original return.
To correct reject code F1040X-001:
- Mail in a paper amended return.
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