IRS Code 806 on your tax transcript indicates the total federal income tax withheld from your wages or other income sources during the tax year, typically reported via Form W-2 (from employers) or Form 1099 (from payers like banks or contractors). This withholding acts as a prepayment toward your federal tax liability, helping cover what you might owe when filing your return—it's not a refund amount itself but gets credited against your final tax bill.

Core Meaning

Think of Code 806 like your employer automatically setting aside part of your paycheck for Uncle Sam each pay period; by tax time, the IRS tallies it up here on your Wage and Income Transcript or Account Transcript. For instance, if your W-2 shows $5,000 withheld in Box 2, expect roughly that figure next to Code 806 (it aggregates all such withholdings). This code posts after the IRS processes your return (often alongside Code 150, receipt of return), and it's factored into calculations for refunds (Code 846) or balances due.

A positive amount under Code 806 means taxes withheld as a credit to your account; a negative could signal an adjustment, like a credit reversal or over-claimed withholding. It doesn't dictate if you'll get money back—that depends on comparing it to your total tax liability (after credits/deductions). Always cross-check against your filed Form 1040, Line 25d.

Real-World Example

In one transcript case, the IRS noted $10,000 under Code 806 (W-2 withholding). After applying $2,000 in credits (Code 766) against a $3,000 liability, they issued a $9,000 refund (Code 846) on March 24. This shows how 806 interacts with other codes for the net result.

Forum Buzz & Trending Views

On Reddit's r/IRS (as of late 2025), users frequently puzzle over Code 806 alongside Codes 150/846, with comments like: "I don’t understand code 150 and 806 I just know my refund is code 846." Many express relief once realizing it's just withholding confirmation, not a red flag—common during February 2026 refund season amid processing delays. Recent discussions (2025-2026) highlight it popping up post-e-filing, with no widespread issues reported; experts advise waiting 21 days for direct deposits if Code 846 follows.

Multiple Perspectives:

  • Tax Pros: Routine credit; mismatches with W-2s trigger audits, so verify forms.
  • DIY Filers: Great news if it matches—means IRS sees your prepayments.
  • Forum Consensus: Ignore isolated panic; pair with full transcript for context.

Next Steps Checklist

  • Verify Accuracy: Compare Code 806 amount to W-2/1099 totals and your 1040.
  • Check Full Transcript: Look for Codes 150 (received), 766/846 (credits/refund), or 420/424 (balance due).
  • If Mismatch: File Form 1040-X or call IRS (wait times high in Feb 2026).
  • Get Transcript: Free via IRS.gov "Get Transcript" tool—Wage & Income type shows 806 best.

TL;DR: Code 806 is your withheld taxes credited—normal and expected; review whole transcript for refund impact.

Information gathered from public forums or data available on the internet and portrayed here.