Tag Archive for IRS Passport Revocation

How IRS Handles Passport Certifications For People With Tax Debt Over $52,000

How The IRS Handles Passports With Tax Debt

To help support fairness and integrity in the tax system, the Internal Revenue Service has made a change in how it handles passport certifications for people with significant tax debt. The Fixing America’s Surface Transportation (FAST) Act, signed into law in December 2015, requires the IRS to notify the State Department of taxpayers the IRS has certified as owing a seriously delinquent tax debt. For further information, see Notice 2018-1 regarding implementation of IRC 7345. The FAST Act also requires the State Department to deny their passport application or deny renewal of their passport. In some cases, the State Department may revoke their passport.

A taxpayer with a seriously delinquent tax debt is generally someone who owes the IRS more than $52,000 in back taxes, penalties and interest for which the IRS has filed a Notice of Federal Tax Lien and the period to challenge it has expired or the IRS has issued a levy. So far, the program has resulted in $1.2 billion in tax payments from taxpayers who the IRS certified to the State Department as being seriously delinquent in their tax debt.

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Passport Revocation By The IRS: What You Need To Know

Olivier Wagner, Passport Revocation By The IRS

More than a year ago, Congress passed law HR 22. It resulted in IRC section 7345 “Revocation or denial of passport in case of certain tax delinquencies”

This is a far-reaching law which covers all taxpayers owing more than $50,000 in back taxes. The intent of the taxpayer to leave the country is not a criterion. Nor it is limited to criminal cases, civil penalties are enough.

Before the IRS can revoke your passport, or prevent you from obtaining a new one, these seriously delinquent tax debt needs to be debt for which a:

  • The government has issued a notice of federal tax lien and all administrative remedies under IRC § 6320 have lapsed or been exhausted
  • The government has issued the levy

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How Can Tax Debt Affect My Passport?

How Can I Undo IRS Passport Revocation?

As we observed previously, there are considerable parallels between losing your drivers’ license for non-driving reasons and losing your passport for non-travel reasons. The IRS cannot suspend your license, because it is a federal agency with no jurisdiction in that area. But your U.S.-issued passport is another matter.

Courts have consistently held that traveling abroad is a privilege and not a right. That stance allows government agencies to invent their own rules when it comes to things like IRS passport revocation.

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Written by | Posted in TaxConnections