IVO Wage Matching: How the Social Security Administration Feeds the IRS

One of the least understood parts of the refund delay process happens far outside the IRS itself. When a return is flagged for income verification, the IRS does not immediately ask the taxpayer for proof. Instead, it turns to a separate federal agency to confirm the facts.

That agency is the Social Security Administration (SSA).

Understanding the IVO wage verification process explains why refunds are frozen, why transcript codes like TC 570 appear, and why the IRS often says it is “waiting on employer data.”

What Is the IVO Wage Verification Process?

The Integrity Verification Operation (IVO) is the IRS unit responsible for confirming that:

• The wages you reported
• The withholding you claimed
• The credits tied to that income

are supported by third-party data.

For wage earners, the primary “truth source” for that data is the Social Security Administration.

Why the IRS Uses SSA as the Wage Authority

Although the IRS ultimately collects taxes, it does not receive W-2 data first.

Here is the actual flow:

1. Employers file W-2 forms with the SSA
2. SSA validates and stores wage and withholding records
3. SSA transmits finalized wage data to the IRS
4. The IRS uses that data for wage matching

Because SSA receives W-2s before the IRS, it becomes the authoritative database for income verification.

How SSA Wage Data Is Used by IVO

When a return is selected for IVO review, the IRS compares your tax return against SSA wage records.

IVO checks:

• Employer EINs
• Reported wages
• Federal withholding amounts
• Number of W-2s filed under your SSN

If the SSA data matches what you claimed, the review ends automatically.

If it does not, processing stops.

Why Wage Matching Takes So Long

Wage matching is not instantaneous because:

• Employers have staggered W-2 filing deadlines
• Corrections (W-2c) can overwrite earlier data
• SSA must validate submissions before sharing them
• IRS systems update in cycles, not in real time

This delay explains why many refunds stall for weeks even when the taxpayer filed accurately.

What Happens When a Mismatch Is Found?

If IVO cannot match your return to SSA wage data:

• A TC 570 (Additional Account Action Pending) freeze is applied
• Refund issuance is blocked
• Automated processing halts

At this stage, the IRS still does not assume wrongdoing. It simply cannot verify the income.

What Happens Next?

If the mismatch persists after SSA data fully populates:

• The TC 570 hold becomes permanent
• The IRS issues a CP05A notice
• You are formally asked to provide proof of income

The CP05A typically requests:

• Recent pay stubs
• Employer statements
• Other wage verification documents

Until those documents are reviewed, the refund remains frozen.

Why This Is Not an Audit

IVO wage matching is often mistaken for an audit, but it is fundamentally different.

IVO:

• Does not question deductions or intent
• Focuses only on wage existence and amounts
• Relies first on employer-reported data

Most cases resolve without penalties once documentation matches.

How This Appears on Transcripts

During IVO wage verification, transcripts often show:

• TC 570 with no release code
• No refund-related transactions
• Long periods of inactivity

Once resolved, multiple updates may post at once.

The IVO wage verification process exists to confirm that the income and withholding on your return are backed by real employer filings.

Your refund may be delayed because:

• The IRS is waiting on SSA wage data
• Your employer has not finalized reporting
• A mismatch requires additional proof

Understanding this process removes much of the mystery behind wage-related refund holds.