Note: This article was written in early 2021.

I’ve had a rough run and have often been shut down or sent to FR. This time Discover also put me through a Financial Review (FR). Discover FRs are rare, so I wanted to share my experience. My FR “trilogy”:

Background

I had two Discover it 5% quarterly category cards. One of them was converted online from a 1.5x Discover Miles card. Recently, I had been using the converted Discover Miles card more often, and I probably cycled the limit twice. Then one day I noticed that the card seemed to stop working.

At first I didn’t think much of it. Discover cards often stop working for a while. I figured maybe it would fix itself after some time. However...

Discovering the FR

Very soon, I received an email (not from Discover), which looked more like it came from EQ, and I ignored it at first.

Subject

  • Verification Services Has Sent You IRS Consent Form 4506-C to Sign

Sender

As shown below, at first I didn’t realize it was a Discover email and completely treated it like spam. The red box in the screenshot says: Discover Financial Services requires your consent to receive tax information from the Internal Revenue Service (IRS) to verify information on your account. Within 5 days, please click the 'Review and sign' link above to provide consent via IRS Form 4506-C.

Because I didn’t handle it, when I later logged into online banking I saw that the card status was wrong. The screenshot below asked me to verify recent purchases, but clicking through didn’t help and I couldn’t verify anything. (Note: only this card was frozen; everything else was normal.)

At that point, I knew something was wrong with the account.

Resolving the FR

First, I called the number on the back of the card. The first time I called was at night, and the rep told me the department handling this issue doesn’t work at night. The second time I called during the day, I told the automated system the card had been frozen, and it immediately transferred me to the lady in that department.

The rep told me that they had sent me IRS tax transcript request Form 4506-C, but I hadn’t responded, so the card was frozen. (Actually, it should have happened at the same time.) I said I hadn’t seen it. She said they would resend it right away, and it needed to be completed by February 24 (within 5 days).

Then I saw the email above again, and this time it clicked. I carefully read the “spam” email and finally understood that I had been FR’d. The requirements were:

You only need to sign online (e-signature). The document password is zip code + the last 4 digits of your SSN.
If the address from the last two years is different from your current address, you need to note that.
After that, wait for Discover’s notice. It’s very similar to AMEX’s FR.

Please follow the steps below:

Upon clicking the link, you will be prompted to enter a Password. The Password is the 5-digit zip code on file with your Discover card account, followed by the last 4 digits of your Social Security Number (SSN) . For example, if the zip code on file is 12345 and the last 4 of your SSN is 0000, you need to enter the password as 123450000.
Complete Line 4 ONLY if the address listed on your last filed tax return is different than Line 3 (current address on file with Discover) .
To complete the form, you must provide your e-signature.


Let’s take another look at this 4506-C. 4506-C is just the updated version of AMEX’s old 4506-T.

If the address on your tax returns for the past two years (2018 and 2019) is different from your current address, you need to indicate that. Otherwise, just sign and submit it directly; you don’t need to fill anything else out. Discover wants to review Form 1040 tax returns (they’ve already selected that for you).

After you submit the signature, you’ll receive a confirmation email from EQ. If you want, you can save a copy for yourself.

After that, it’s a “long” wait for Discover to review your Form 1040 tax return and send an update.

After I submitted the 4506-C on February 20, I finally passed the review on March 4, and the account returned to normal.

  • Email subject: Important information regarding your account
  • Screenshot below:

Other

There are also some similar reviews on Reddit; see here:

In the community data points, some people said Discover selected them at random, some said it happened after requesting a credit limit increase, some said it was caused by spending too much in a short period of time (my situation), and some said it happened because they had a new account. In short, Discover is questioning your income and asking to review your tax return.

Based on the data points above, if the review fails or you don’t provide the documents in time, Discover will immediately shut down all of your accounts!

There are also posts on Ficoforums; see here:

In the community data points, some people said Discover selected them at random, some said it happened after requesting a credit limit increase, some said it was caused by spending too much in a short period of time (my situation), and some said it happened because they had a new account. In short, Discover is questioning your income and asking to review your tax return.

Based on the data points above, if the review fails or you don’t provide the documents in time, Discover will immediately shut down all of your accounts!

Summary

Here’s a summary of my entire review process:

  • 02/11: Email notifications began, and reminders continued daily through 2/15
  • 02/20: I discovered the account was frozen. After calling, they resent the email, and I submitted the 4506-C that same day
  • During this time, the payment due date was approaching. I called to ask how to make the payment, and the rep said they could temporarily unfreeze the card so I could pay, or they could choose Checking and pay that way. I asked for a temporary unfreeze so I could verify a few purchases. (Answering yes was enough...)
  • Soon after paying the bill, the account was frozen again
  • After 03/04, the review ended, the account was unfrozen, and everything returned to normal