IRS Tax Return Reject Code IND-516-02

IND-516-02 rejection code is an indication by the IRS that the taxpayer is only allowed to claim a particular SSN for a given tax year, and the one that is entered has already been used as a dependent on another return. This means that when you entered the SSN, it showed that someone else might have claimed a similar SSN for that year and therefore, you will be unable to claim it as a dependent on your tax papers.  

It is very necessary to resolve this issue, and the first thing you must do is to confirm that information is entered properly when the reject code IND-516-02 arises. On the other hand, if there is a reason to believe that the particular SSN entered has not been claimed by anyone else other than yourself, you should contact the IRS immediately. 

However, if the case is otherwise and if someone did claim the SSN on another return, you need to rectify it to delete the dependent claiming the SSN when you receive IND-516-02. It is essential to fix this to avoid any penalties levied by the authorities

Reject Codes R0000-902-01, R0000-507-01, IND-516-01, IND-515, and IND-517-01 are some similar denial codes that relate to SSNs being claimed on other tax returns.

What are the Reasons Behind Federal Return Rejection Reject Code IND-516-02?

There are a few possible reasons why the IRS may reject a tax with federal return rejection reject code IND-516-02. Here are a few possibilities:

1. Particular SSN can be claimed once a year

The IRS only allows one taxpayer to claim a particular SSN for a given tax year, so if someone else has already claimed it, you won’t be able to claim it as a dependent on your return.

2. Incorrect SSN: 

Another possibility is that there was a mistake in the SSN you entered on your tax return that leads to IND-516-02. if you entered is inaccurate, you should correct it.

3. The SSN belongs to the head taxpayer: 

The SSN you provide as the primary taxpayer should be your own, while the SSNs you provide for dependents should belong to the people you are claiming as dependents.

4. Identity theft or fraud: 

In some cases, this reject code IND-516-02 could be the result of identity theft or fraud. If someone has stolen your SSN and used it to file a fraudulent tax return, this could activate an error message when you try to file your legal return.

How Do I Fix Business Rule IND-516-02 in TurboTax?

In TurboTax, you can use the methods provided below to resolve the reject code IND-516-02 relating to the SSN already claimed on another tax return.

1. Use the TurboTax tool to check for errors: 

TurboTax has a built-in tool called the “TurboTax Error Checker” that can help you identify and correct any errors on your tax return, including errors related to SSNs. You can access this tool by clicking on “Tools” in the TurboTax menu and selecting “Error Checker.”

2. Verify that no one else has claimed the dependent: 

Use the TurboTax tool “Find Dependent SSN” to verify that no one else has claimed the dependent in question. In the application, go to “Federal Taxes” in the TurboTax menu, select “Deductions & Credits,” and then choose “Child & Dependent Care.” Follow the prompts to enter your dependent’s information, and TurboTax will check if the SSN has already been claimed by another taxpayer.

3. File an amended return: 

If you discover that another taxpayer has already claimed the SSN as a dependent, you will need to file an amended return to remove the dependent from your original tax return. In TurboTax, go to “Federal Taxes”, select “Amend a Return,” and then follow the prompts to make the necessary changes to your tax return.

Reject Code IND-516-02 should be addressed as early as possible. This is because it might lead to identity theft as it relates to the SSN, the most important document to claim refunds from the IRS. The above-provided guide can help you resolve it. However, if it still occurs contact the SSA or the IRS directly.

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