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Tax Topic 152 Explained

You may come across the phrase ‘Refer to Tax Topic 152’ while investigating the status of your tax return. If taxpayers observe the Tax Topic 152 reference code when checking the status of their tax return using the IRS “Where’s My Refund?” tool, this means that there may be a delay in processing time.

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Key Takeaways:

  • Tax Topic 152 refers to a generic reference code that appears on a tax transcript when there may be a delay in the processing of your income tax return.
  • Some reasons you may see Tax Topic 152 and your tax return may take longer to process include filing a tax return on paper instead of using the online form, claiming an injured spouse on your return, including the Earned Income Tax Credit or Additional Child Tax Credit on your return, applying for an Individual Taxpayer Identification Number (ITIN), filing an amended return, or requesting your refund from tax withheld on Form 1042-S by filing Form 1040-NR.
  • One of the best ways to prevent a delay in your tax refund is to prepare your necessary tax and financial documentation ahead of time and fill out the tax return extremely carefully.
  • If you observe Tax Topic 152 on your account you must wait until the IRS either accepts your return and issues your refund or they issue Tax Topic 152 and send a letter explaining changes to your account. 

Facts and Statistics:

  • 90% of tax refunds are processed within 21 days of the return being submitted, according to the IRS.

What Is Tax Topic 152?

Tax Topic 152 is a generic tax code informing the taxpayer that their tax return may take longer than usual to process. Some tax codes identify missing or additional steps the taxpayer must take in order to have their tax return successfully processed, but with Tax Topic 152, the taxpayer does not have to take action. 

Observing Tax Topic 152 on your tax return doesn’t automatically mean that you made a mistake in filling out your tax return. Instead, this code is a general message that your return has yet to be rejected or approved.

Reasons For Tax Topic 152

You may be wondering why you are observing Tax Topic 152 on your account. There are several reasons your tax return may take longer to process. Some of those include:

Filing a tax return on paper instead of using the online form

It can take longer for mailed tax returns to be processed compared to those submitted online.

Claiming an Injured Spouse on your return

The Injured Spouse Claim allows people who file taxes jointly with their spouse but are not responsible for their debts owed to the IRS to request their portion of the tax refund separately from their partner’s. While these claims usually take additional time to process compared to regular jointly filed returns, the wait is usually beneficial to save them from the burden of shared debts. 

The return includes the Earned Income Tax Credit (EITC) and/or the Additional Child Tax Credit

For tax returns that request an EITC due to being low or moderate income or an Additional Child Tax Credit, the IRS may require additional time to process. The IRS lists personalized refund estimates online but hopes to issue these refunds by March 1.

Applying for an Individual Taxpayer Identification Number (ITIN)

Individual Taxpayer Identification Numbers (ITIN) allow the IRS to appropriately identify taxpayers. Most filers use their social security number as their taxpayer identification number when filing their taxes. Those who utilize an ITIN, such as resident and non-resident aliens, usually experience a longer processing time for their tax returns. 

The refund is from an amended return

For those who filed an amended return, most tax refunds are received within 16 to 20 weeks. 

The refund is being requested from tax withheld on Form 1042-S by filing Form 1040-NR

It can take up to 6 months for non-resident aliens who filed a tax return to receive their tax refund.

How To Prevent Delays In Receiving Your Tax Refund

While some delays in the processing of tax returns are out of the taxpayer’s control, there are some preparations you can make when preparing your taxes to prevent the likelihood of delays. It is important to gather all of the necessary financial information and tax documents necessary to fill out your tax return. These documents include:

  • Your taxpayer identification number
  • Your previous year’s tax return
  • Personal identification details, such as the full names, social security numbers, and birth dates of you, your spouse, and any dependents listed on your return.
  • Income-related forms, including W-2s and 1099s
  • Health insurance-related forms, such as Form 1095
  • Your Identity Protection PIN, if applicable

Filling out your tax return carefully and accurately will reduce your chances of making a mistake and having your tax return rejected. 

What Does Tax Topic 152 Mean Moving Forward?

The good news about receiving Tax Topic 152 is that you do not have to do anything to continue the processing of your tax return. Once your tax return has been processed, you will observe one of two outcomes.

The first outcome is if your tax return is ultimately accepted and your refund is sent.

Alternatively, the IRS may place your account under review. If this happens, you will observe Tax Topic 151 on your account and the IRS will contact you by sending you a letter that explains the changes to your return. 

How To Contact The IRS

Contacting the professionals at the IRS is sometimes the best way to resolve your tax problems. There are three main ways to do this:

  1. Call the IRS
  2. Visit your local IRS office
  3. Utilize the Taxpayer Advocate Service

Understanding the different tax codes that can appear on your tax transcript is intimidating – especially when receiving a tax refund can significantly impact someone’s financial status. If you have questions about your tax situation or need help filing your tax return, consult with a tax expert at Ideal Tax today.

Frequently Asked Questions

How are tax rates determined?

A tax rate is calculated by dividing the income tax expense by earned income before taxes.

What is a tax bracket?

Tax brackets correspond to the tax rates you will pay for each portion of your income. 

What is a tax cut?

A tax cut is a change to tax law resulting in a reduction in how much tax must be paid. This is the opposite of a tax increase.

What is tax liability?

Tax liability is how much an individual or small business owes in tax payments. This sum is calculated by subtracting any tax deduction from your taxable income. Your tax liability may be outlined in writing in your tax bill. 

What is tax reform?

Tax reform is the changing of the structure of the tax system.

What are the main types of tax revenue?

The three main types of tax revenue are income, sales, and property taxes. 

Tax Evasion vs. Tax Avoidance

Tax evasion is failing to pay or deliberately underpaying what is owed in taxes. Tax avoidance involves taking action to lessen tax liability and maximizing after-tax income.

Tax Haven vs. Tax Shelter

A tax haven is usually used by large and wealthy corporations to reduce what is owed in tax liability in the same country they operate or reside in.  A tax shelter is a legal method of reducing tax liability by investing. 

What is a tax benefit?

A tax benefit refers to tax laws that help taxpayers reduce their tax bill. This can be through claiming tax credits or tax-exempt deductions.

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