SS Card not valid for work, but working and has several W2s using that SSN, not qualified for the RRC?

"does IRS even know if an SSN is marked that way?"

We've seen people (lost) on this forum who realized all they had to do is Ask for their card to be updated.

And yes, that is specifically stated in the eligibility:

"are not a dependent of another taxpayer and have a Social Security number valid for employment"

Here:

https://faq.ssa.gov/en-us/Topic/article/KA-01436

Yes, you need to disallow the credit because you know it is not allowed.  You can probably do whatever you want on the worksheet to disallow it.

Social Security Cards marked Not Valid For Employment were commonly issued years ago to facilitate payment of social Services,Welfare, benefits for undocumented aliens primarily medical benefits. My experiance is that Social Security leaves it up to the tax preparer to make that determination and does not keep track of this issue. The reason you receive w2s with these numbers is the Employer is not verifying the social secrity number at the time of employment as required by law. A similar problem exist when ficticious numbers appear on the w2s  for ITIN number holders. You will get an error message for the ITIN error or social security number not in valid range and you have to go to the W2 worksheet and indicate the social security number on the W 2 even if it is ficticious. You may also find it amazing that I have udocumented tax filers with ITIN numbers that have been doing this for 10 years and the issue still remains unresolved. What is the point of an ITIN number if employers are istructed not to accept them and yet do not use e verify to confirm socials. Just saying! There is hope  as I hope this helps