IRS Transcript Codes 290 & 291: Tax Adjustments and How They Impact Your Refund

If your IRS transcript suddenly shows Code 290 or Code 291, it means the IRS made a correction to your tax return — and your refund amount may have changed.

These codes appear during Error Resolution processing, which often follows:

• Wage/income mismatch
• Dependent claim issues
• Credit qualification adjustments (EITC/CTC)
• Recovery Rebate / Stimulus corrections
• Withholding reporting errors
• IRS catching missing income from W-2/1099 files

This article explains what each adjustment code means, what caused it, and what happens next.

Code 290 — Tax Assessed (Refund Reduced or Amount Owed)

Code 290 means the IRS added tax to your return.

This can result in:

• A reduced refund, or
• A new balance owed to the IRS

Common reasons for Code 290:

• IRS located more income than reported
• Tax credits were reduced or denied
• Filing status corrected
• Child/Dependent errors
• Math error on return

Code 290 almost always results in less money.

Your transcript will show a dollar amount next to Code 290
— this is the amount added to your tax liability.

Code 291 — Tax Decreased (Refund Increased)

Code 291 is a positive update.
It means the IRS reduced your tax liability.

That usually happens when:

• Eligible credits were increased
• Dependents or withholding got re-verified
• IRS corrected something in your favor

This code adds more money to your refund.

Where You Will See the Change

Watch your Refund Amount section:

Example Scenarios

If Code 971 appears, a notice has been sent (or will be).

What Happens to Your Refund Timeline?

Adjustments reset part of your processing timeline temporarily.

Most taxpayers see 2–6 week delays after adjustments.

Should You Call the IRS?

Call ONLY if:

✔ Code 290 reduces refund and you disagree
✔ Code 971 notice requests documents
✔ No movement for 60+ days after adjustment
✔ Adjustments are major (thousands of $ change)

IRS phone: 800-829-1040

Positive Signs to Watch For

These often appear before refund release:

• 571 / 572 — Hold cleared
• 811 — Freeze removed
• As of Date moves forward
• Code 846 — Refund issued

Once 846 posts — countdown to deposit begins.

Quick Interpretation Table