Form 4506-C Common Rejection Reasons

Ensure your Form 4506-C is free from common IRS-identified defects to avoid unnecessary processing delays.

Why does the IRS reject Form 4506-C?

Most 4506-C rejections happen because IRS OCR scanning can’t reliably read the form. The most common causes are name/SSN or EIN formatting issues, address box problems, missing participant/client details, incorrect transcript selections, and signature or date placement.

The Challenge

High 4506-C rejection rates: Manual IRS submissions face rejection rates exceeding 30%. Simple clerical errors cause costly closing delays and operational overhead.

Legacy fax-based workflows can’t keep up with modern demand for real-time, secure income verification.

The Solution

Automated IVES fulfillment: As a Certified IVES Participant, Easy Verification provides a direct digital pipeline to the IRS.

Replace manual friction with automated precision for fewer rejects and faster approvals.

OCR Sensitivity Alert: IRS Form 4506-C requests are processed via Optical Character Recognition (OCR), making the form highly sensitive to formatting errors and manual alterations.

Lines 1–2 Taxpayer Information

Individual Taxpayer

Borrower name or SSN entered in the wrong field.

IRS Form 4506-C example showing borrower name and SSN entered in the same field

SSN not in XXX-XX-XXXX format (hyphens required).

IRS Form 4506-C example showing an incorrectly formatted Social Security number

Multiple borrowers listed (other than spouse).

IRS Form 4506-C example showing multiple borrowers listed who are not spouses

Business Taxpayer

Business name exceeds 22 characters (including spaces).

IRS Form 4506-C example showing a business name exceeding the character limit

Incorrect EIN format (must include hyphens).

IRS Form 4506-C example showing an incorrectly formatted employer identification number

Lines 3–4 Address Information

Incorrect/incomplete address: Missing APT or STE #. Must match the last return filed.

IRS Form 4506-C example showing a missing apartment or unit number in the address

Missing or incorrectly placed street, city, state, or ZIP code.

IRS Form 4506-C example showing missing or misplaced street, city, state, or ZIP code in Lines 3–4

Line 5 Participant & Client

Participant/client section incomplete or blank.

IRS Form 4506-C example showing missing participant or client information in Line 5a

“N/A” or “not available” entered in any required participant/client field.

IRS Form 4506-C example showing “N/A” entered in required participant or client fields in Line 5a

Missing participant/client name, phone, or address details.

IRS Form 4506-C example showing a missing client telephone number in Line 5

Lines 6–7 Transcripts & Forms

Line 6: Tax Return Transcript

Multiple form types listed.

IRS Form 4506-C example showing multiple tax return form types listed in Line 6

W-2 or 1099 entered (not valid here).

IRS Form 4506-C example showing a W-2 entered in Line 6 where it is not permitted

Multiple or no checkboxes selected (6a–6c).

IRS Form 4506-C example showing missing or incorrect checkbox selection in Line 6

Line 7: Wage & Income

Line 7 selected in addition to line 6.

“1040” listed instead of specific W-2/1099 transcript types.

IRS Form 4506-C example showing Form 1040 listed in Line 7 instead of specific W-2 or 1099 transcript types

Failure to select the correct borrower box for the request.

IRS Form 4506-C example showing failure to select the correct borrower in Line 7

Line 8 Year or Period

Formatting: Date not in MM/DD/YYYY format.

IRS Form 4506-C example showing a date not entered in MM/DD/YYYY format in Line 8

Retention limits: Requested tax year may be unavailable (commonly current year + prior years).

IRS Form 4506-C example showing a requested tax year outside IRS retention limits in Line 8

Filing delay: Return not filed/processed yet for the current cycle.

IRS Form 4506-C example showing a tax return not yet filed or processed for the requested year in Line 8

Authorization Signature & E-Sign

Individual Taxpayer

Electronic signature box not checked.

IRS Form 4506-C example showing the electronic signature authorization box not selected

Signature spills beyond the field.

IRS Form 4506-C example showing a signature extending beyond the designated field

Date missing (must be separate from the e-sign stamp).

IRS Form 4506-C example showing signature and date not entered in separate required fields

Business Taxpayer

Missing title (President, Partner, etc.).

IRS Form 4506-C example showing a missing business signer title in the authorization section

General Form Integrity

Optical Character Recognition (OCR) i

Field overlap: Data entered in the wrong field or bleeding into adjacent areas.

IRS Form 4506-C example showing data overlapping into adjacent fields affecting OCR accuracy

Handwritten

Alterations: White-out, cross-outs, strikethroughs, overwrites.

IRS Form 4506-C example showing form alterations such as white-out or cross-outs that interfere with OCR processing

Handwritten entries: Illegible handwriting in Lines 1–8.

IRS Form 4506-C example showing illegible handwritten entries in Lines 1–8 that interfere with OCR processing

Status Married Filing Separately

Submit a separate Form 4506-C for each spouse when filing status is Married Filing Separately.

IRS Form 4506-C example showing Married Filing Separately requiring a separate form for each spouse

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