Form 4506-C explained
IVES Request for Transcript of Tax Return
Form 4506-C is the taxpayer's authorization for the IRS to release tax transcripts to a third party, almost always a lender verifying income. It is signed by the taxpayer and submitted by the lender, not filed with a return.
- Who files it
- Signed by the taxpayer, submitted by an IVES participant. IVES is the IRS Income Verification Express Service, and a lender must be enrolled in it to use the form.
- Where it goes
- The IRS, through the IVES program rather than by ordinary mail.
- When it is due
- No deadline. The IRS must receive it within 120 days of the taxpayer's signature date, and a form older than that is rejected.
- What it is not
- It does not produce a copy of the return. A transcript is a summary of line items as the IRS holds them. Form 4506 is the request for an actual copy, and it costs money and takes far longer.
What it reports
The form's boxes decide what the lender receives. A wrong box is the commonest reason a request comes back with the wrong document.
| Box | What it reports |
|---|---|
| 1a and 1b | The taxpayer's name and taxpayer identification number, as they appear on the return being requested. |
| 5a | The IVES participant receiving the transcript: the lender's name, address, and IVES participant number. |
| 6 | Which return the transcript is for, by form number: 1040, 1065, 1120, and so on. |
| 6a, 6b, 6c | Which kind of transcript: the return transcript, the account transcript, or the record of account. |
| 7 | Wage and income transcripts, which report W-2 and 1099 information the IRS received from payers. |
| 8 | The tax years or periods requested. Each request covers a limited number of periods. |
A transcript is not a return
A return transcript lists most line items from the return as originally filed. It does not show changes made after filing, which is what the account transcript is for, and it does not reproduce the return's own pages or its attached schedules.
A lender comparing a borrower's supplied return against a 4506-C transcript is checking that the two agree. That comparison is the reason the form exists, and it is why a lender asks for the transcript rather than accepting the return alone.
The signature window is the usual failure
The IRS must receive the form within 120 days of the signature date. A form signed at application and submitted after a long underwriting cycle expires, and the borrower has to sign a fresh one.
LedgerBox does not read this form
LedgerBox does not read Form 4506-C or the transcripts it produces. It reads the bank statements and pay stubs that sit alongside them in a lending file, and checks the arithmetic on each.
Form 4506-C questions
What is the difference between Form 4506-C and Form 4506-T?
4506-C is the version used by IVES participants and is the one a lender will send. 4506-T is the general transcript request. A lender enrolled in IVES uses 4506-C.
How long does a 4506-C take?
Turnaround is set by the IRS and by the IVES participant's own queue, and it varies. Ask the lender, since they are the ones who submit it and receive the result.
Can I refuse to sign a 4506-C?
Yes, and the lender can then decline the application. Income verification against IRS records is a condition of most mortgage lending, so refusing usually ends the application rather than changing it.
Does a 4506-C show my bank transactions?
No. It returns what the IRS holds: return line items, account activity on the tax account, and the W-2 and 1099 information payers reported. Bank transactions never reach the IRS in that form.
Read next
- Document verification for lenders What the checks on a borrower's statement establish, and what they do not.
- Using a bank statement as proof of income The document lenders read alongside the transcript.
- Pay stub extraction The other income document in the same file.
Reference pages on the forms that arrive with a set of books. Every form in the glossary