The failure-to-file penalty — 5% of unpaid tax per month late, up to 25%. Here is what it means, what usually happens next, and what to do.
On your account transcript it reads: 166 Penalty for late filing of tax return Adds to what you owe
TC 166 is the failure-to-file penalty — 5% of the unpaid tax for each month or part of a month the return was late, up to 25%, with a minimum penalty for returns more than 60 days late.
Reversal code: TC 167 — Late filing penalty abated. When it posts after this code, the effect above is undone.
Also written as: IRS code 166, code 166 on transcript, 166 IRS code, transaction code 166.
It shows up on your bill (usually a CP14) and accrues interest from the notice date. It is one of the most frequently removed penalties, through first-time abatement or reasonable cause. A TC 167 shows it abated.
| On the same transcript | What it usually means |
|---|---|
| 166 + 276 + 196 | The standard trio on a late, unpaid return: filing penalty, payment penalty, interest. |
| 166 then 167 | Penalty abated — removed in part or in whole. |
Three clean prior years usually means removal on request.
Illness, disaster, records unavailable — with dates.
By phone for first-time abatement, or in writing / Form 843.
Paste it into the free decoder — every code explained, open holds flagged, refund and offsets summarized. Runs in your browser; nothing is sent anywhere.
Decode my transcript →Often — through first-time abatement or reasonable cause. A TC 167 on the transcript shows the abatement.
The late-filing penalty was abated (removed) in part or in full.
On your IRS account transcript for the tax year — in your IRS Online Account under tax records, or by mail using Form 4506-T. The transactions section lists each code with its description, date and amount. Return transcripts do not show transaction codes.
Yes. IRS code 166, code 166 on transcript, transaction code 166 and TC 166 all refer to the same three-digit transaction code the IRS posts to your account.