Why does Xbox say "An error occurred during the transaction"?

"An error occurred during the transaction. Please try again later" is the same class of error as "Something went wrong" and has the same causes: Xbox server outages, browser cache issues, stale login sessions, or an outstanding balance on your account. Check https://support.xbox.com/en-US/xbox-live-status first. If servers are up, try redeeming at https://redeem.microsoft.com in an Incognito window and sign out then back into your Microsoft account before trying again.