What Does Rejection Code IND-165-01 Mean and How Do You Fix It?

Understanding tax rejection codes is crucial for taxpayers and professionals, as they can disrupt the filing process and delay refunds. One such code, IND-165-01, often causes confusion due to its specific nature. Addressing this issue promptly is essential for a smooth tax submission experience.

This article will explore what triggers this rejection code and provide actionable steps to resolve it efficiently.

Common Errors That Trigger the Rejection

Rejection code IND-165-01 arises from discrepancies in the taxpayer’s prior-year Adjusted Gross Income (AGI) or Personal Identification Number (PIN), both of which are used to verify identity. A common mistake occurs when taxpayers enter an incorrect AGI from the previous year, often due to outdated records or overlooked amendments. The IRS relies on the AGI for authentication, and mismatches will result in rejection.

Issues also often involve the self-select PIN, a five-digit number chosen by the taxpayer. Taxpayers may confuse this with other identification numbers, such as the Electronic Filing PIN or the IRS-issued Identity Protection PIN. Misplacing or misremembering the self-select PIN can lead to rejection. Properly distinguishing between these numbers is key to avoiding complications.

Adjusting Prior-Year Data

To address IND-165-01, first ensure the prior-year AGI is accurate. Discrepancies often stem from amendments to prior-year returns. Taxpayers who amended their returns may overlook the updated AGI, causing inconsistencies. Confirming the AGI using IRS transcripts or official documents is the most reliable approach.

Taxpayers should also review any amendments or corrections made to the prior year’s return. Amendments, which can alter the AGI, must be accurately reflected in the current filing to avoid rejection. Using IRS Form 1040-X for amendments and ensuring these changes are correctly incorporated into the current return is essential.

Requesting Verification From the IRS

If correcting prior-year data does not resolve the issue, contacting the IRS for verification is necessary. This process involves confirming identification and other key details.

The IRS’s online “Get Transcript” tool allows taxpayers to access records, including prior-year AGI transcripts, to ensure data matches IRS records. Alternatively, taxpayers can schedule an in-person appointment at a Taxpayer Assistance Center, an option helpful for addressing complex issues.

For those preferring phone assistance, the IRS helpline provides direct support. Having necessary documents, such as prior-year returns and Social Security numbers, ready during the call ensures a smoother process and minimizes delays.

Re-Submission Procedures

Once verification is complete, re-submit the tax return with corrected information. Confirm that the AGI and all identification numbers align with IRS records. Using updated tax preparation software can help minimize errors and streamline the process.

During re-submission, review filing status, deductions, and credits to ensure accuracy. For instance, double-check standard deduction amounts to maximize benefits. Leveraging IRS e-file options is recommended for faster processing, offering a more efficient alternative to paper submissions.