IRS review process– In the 2026 tax season, some taxpayers are noticing that their final refund is lower than expected after IRS review. Reductions of around $400 are being reported by filers who initially calculated higher refunds. These adjustments occur when the IRS corrects errors or recalculates credits during verification. Understanding why this happens helps taxpayers avoid confusion.
Why the IRS Reviews and Recalculates Refunds
The IRS cross-checks filed returns with employer reports, credit eligibility rules, and income records. If discrepancies are found, the system recalculates the refund amount. This process ensures accuracy but may reduce the originally expected total. The correction happens before the refund is issued.
Common Reasons for Refund Reductions
Errors in credit claims, incorrect income entries, or dependent eligibility issues are frequent causes. Some taxpayers unintentionally overclaim benefits due to misunderstanding rules. When the IRS corrects these entries, the refund amount adjusts accordingly.
Refund Adjustment Overview
| Issue Identified | IRS Action | Impact on Refund |
|---|---|---|
| Overclaimed credit | Recalculation | Refund reduced |
| Income mismatch | Data correction | Lower amount |
| Dependent eligibility error | Credit removal | Adjustment applied |
| Mathematical mistake | System correction | Accurate total issued |
This table shows how review findings lead to refund changes.
How Taxpayers Are Notified About Changes
When adjustments occur, the IRS provides a notice explaining the reason for the change. This notice outlines which part of the return was corrected. Reviewing this communication helps taxpayers understand the reduction clearly.
What Filers Can Do to Avoid Adjustments
Careful review of credit rules, income details, and dependent information before filing reduces the risk of corrections. Using accurate documentation and double-checking calculations can prevent refund surprises. Filing correctly the first time ensures smoother processing.
Conclusion
Refund adjustments in 2026 are part of the IRS effort to ensure accurate payments. While losing around $400 can be disappointing, these corrections reflect updated and verified information. Understanding the review process helps taxpayers stay informed and prepared. Accuracy during filing remains the best safeguard.
Disclaimer: This article is for informational purposes only. Refund adjustments depend on official IRS review processes and individual filing details. Taxpayers should verify notices through authorized IRS sources.