766 | Credit to account
This code indicates that a credit has been applied to the taxpayer’s account for the specified tax period.
What This Code Means
Code 766 reflects that a credit amount has been posted to the account. Credits may originate from refundable credits claimed on the return, payments made, or adjustments processed by the IRS. The code represents the application of a credit that reduces the balance due or increases a potential refund. It does not specify the source of the credit unless additional context appears elsewhere on the transcript. The presence of code 766 does not automatically indicate a refund has been issued; it indicates a credit has been recorded.
Where Users Usually See This Code
- On IRS account transcripts under transaction codes
- Following processing of refundable credits
- During review of account activity for a tax year
Why This Code Appears
- A refundable credit was claimed and processed
- A payment or credit adjustment was applied
- The IRS posted a correction resulting in a credit
- A carryover or prior adjustment was applied to the account
What Typically Happens Next
- The account balance may decrease or show an overpayment
- Additional refund-related codes may post if applicable
- Further adjustments may appear if review continues
What This Code Is Not
- It is not confirmation of refund issuance
- It is not an audit indicator
- It does not specify the reason for the credit without supporting codes
Troubleshooting Checklist
- □ Review the credit amount listed next to the code
- □ Check for refund issuance codes following the credit
- □ Confirm whether additional adjustments appear afterward
- □ Consult official IRS resources if clarification is needed
Notes And Edge Cases
Multiple 766 entries may appear if several credits were applied separately. The amount associated with the code reflects the credit applied at that posting date. Credits may later be adjusted or offset depending on account activity. Reviewing the entire transcript provides context for how the credit affects the overall balance.