IRS direct deposit Entry Code PPD

[Greta]

Client received $1700 direct deposit Code PPD. I had filed 2019 and 2020 returns but refunds expected were larger. It seems it might match the first stimulus payment for a dad and his son, is that Code PPD?

[PATAX]

Greta I believe that means the i r s reduced the refund because of an issue they found. They should send a letter out in a few weeks or so explaining the adjustment. Just my opinion

[dkh]

I would have client ask the bank where the money originated from - IRS or something else.   Did the deposit date fall in line for when EIP #1 would have been issued?

[qbteachmt]

"EIP" is in the code for EIP. PPD can be from an offset, such as debt collection. Did your client have another code, such as 449 or 310? Did you or they pull their Tax Account Transcript?

Here's an example of how it looks, and it should show them more info:

https://www.taxpayeradvocate.irs.gov/news/nta-blog-transcripts-pt2/

[Greta]

Thank you all. It's TREAS 310 Entry Class Code: PPD. March 24, 2022. I believe it's in response to my filing new client's 2019 and 2020 tax returns, which IRS might process later, but for now credited him with the first stimulus payment for him and his dependent son? That might explain a partial round-number $1700 refund. Maybe PPD means partially paid 🙂

[qbteachmt · Accepted solution]

"EIP" is in the code for EIP, such as TAXEIP3; if that is the only thing, it would show this. Tax Refunds are coded TAXREF. 310 means electronic payment (direct deposit, not by paper check or prepaid card). PPD is banking:

"Prearranged Payment and Deposit (PPD)
Prearranged Payment and Deposit (PPD) is the Automated Clearing House (ACH) format used by the federal government for consumer payments."

"Standard Entry Class Code
The Prearranged Payment and Deposit (PPD) is the SEC code used for identifying federal agency consumer payments. The payment entries may be accompanied by a PPD addenda record (PPD+) which further identifies the reason for the payment."

Because there is no specific code here, their tax account transcript would show more details. It likely is a combination, and since you stated it is less than expected, there may be a follow up payment once the return is reviewed. Yes, if you filed 2019 and 2020 late, they would not pay out everything until penalties and interest are determined.