Unless you’re an accountant, you’ve probably never even heard of an IRS account transcript—but it’s the best hack there is for getting an accurate snapshot of your income, deductions, tax payments, tax filings, and account activity records. 

Here’s how it works: the IRS receives a copy of every single tax form filed by you – or “on” you (by, say, an employer or brokerage firm). If you’re paralyzed with fear of filing your tax return because you might be missing documents, you can easily find them by accessing your IRS transcript. It’s such a helpful (and free) tool that I urge all of my clients, family and friends to take advantage of the option – and the Taxpayer Advocate Service does, too.

There are five different types of IRS transcripts, but for this hack we’re focusing on three of them: the wage and income transcript, the account transcript, and the prior-year record of account transcript.

“Why Should I Download My IRS Transcript?”

First, it’s important to note that there is more than one type of transcript, and each meets a different need… a different “why should I”. The most important one for filing your taxes is called the “wage and income transcript”:

• Can’t find some of your W-2s from working several jobs?
• Not sure whether your freelance gig issued a 1099-NEC? Or maybe you lost track of countless different contract work payments?
• You’re pretty sure you have an old dividend- or interest-bearing account given to you by your grandparents but can’t ever find the form they mailed?
• Do you pay student loan interest, tuition, or mortgage interest and you can’t find the forms because you moved during the year?
• No matter how many times you try to download your retirement distribution tax form, something goes wrong with the site?

The beauty of a wage and income transcript is that every one of those documents sent to you – they’re called “information returns” – is also sent to the IRS, with your social security number as a unique identifier. So by downloading this list of documents from the IRS, you get a summary of everything filed on your behalf.

However, it takes time for the IRS to wade through all these filings and post them to your account. Sometimes they’re not all posted until a month or two after Tax Day. If nothing has posted yet, it will simply say “No record of return filed.”

But if you’re filing taxes for a prior-year or on extension, it’s a total gold mine. Our firm has even helped clients catch up on tax returns from years’ past by recreating their history based on these transcripts. (That said, I recommend downloading it even if you’re filling on time, just to verify that you’re not missing anything in your pile of tax forms.)

The second most-important transcript during tax-filing season is the ”account transcript”. This lists information on payments and credits posted to your account throughout the year, and we actually require our own clients to submit it to us with their tax organizer annually:

• Don’t remember how much and when your estimated tax payments were?
• Did you receive payments, such as stimulus checks or advance EIC or child tax credits?
• Going through divorce proceedings, do you need to know on which spouse’s account payments were made or credits applied, or how much tax withholding was paid?

And lastly, there’s the “record of account transcript”, which combines a “return transcript” of a prior-year tax return with any activity posted since then.

• Do you need to review last year’s return to make sure you’re not forgetting something important this year?
• Are you being asked to verify your income when applying for a mortgage or financial aid, SBA loan, social services or checking on a prior-year tax refund?

The best news where downloading any transcript is concerned? All you need is a photo ID, a mobile phone with a camera, an email address, and an Internet connection. 

Keep in mind that the IRS will not email you a transcript; you must go online and create or log in to your account and download it. There are email scams out there that entice folks to click on a link or attachment with the promise of an IRS Online transcript – don’t fall prey.

“How Can I Download My IRS Transcript?”

1. From the IRS website, you’ll need to create an ID.me account. (This is the most involved of the steps, but thankfully you only have to do it once; moving forward, you’ll simply sign into the same account each time.) The ID.me website uses facial recognition to confirm your identity, so you’ll need your phone to take a selfie.

If you need help creating your ID.me account, the ID.me Help Center spells out the process very clearly. You can also watch this video or review these written instructions if you want to review the process first.

2. Once your account is created, log in, go to the IRS’s Get Transcript page and click the “Get Transcript Online” button.

3. Select the reason you need a transcript (it’s fine to just select “Other”).

4. Leave the Customer File Number blank and click “Go.” The screen will display all four (or five, if you have non-filing years) transcript options and the available years.

5. Under Wage & Income Transcript, select the tax-filing year.

6. After you select your transcript, like magic, a PDF will pop up in a new tab of your browser with all the information you need. (Or it will say “No record of return filed,” if nothing has posted yet.)

7. Print the file to PDF and save it somewhere safe, along with the rest of your tax season documents.

As explained above, your wage and income transcript will list all forms W-2, 1099, 1098, and 5498 that have been processed by the IRS so far for the tax year in question.

8. Then go back to the open “Get Transcript” tab and click the tax year under Account Transcript, which will list all payments and credits on your account.

9. Lastly, go to the Record of Account Transcript section and click the prior-year link. It will list all account activity for the tax year in question, followed by every single field from your tax return.

(And if you want to get deep into the weeds, NASFAA has an amazing “Tax Transcript Decoder” that compares the fields on a tax return to the fields on a tax return transcript, and Saving To Invest had fun with highlighters when creating a legend for each row on an account transcript.)

Done! Let the tax return preparation begin!

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