Passport Revocation for Seriously Delinquent Tax Debt

The IRS can tell the government to take away or limit your passport if you owe a lot of taxes. This law was passed in 2015 but didn’t start being enforced until 2018. This can affect anyone, not just lawyers, so it’s important to know about it. If you owe more than $50,000 in federal taxes and the IRS has tried to collect it but you haven’t paid, they can revoke your passport. They have to give you notice before they do it, but some people think the notice should be better. They send the notice to your last known address, so if you haven’t filed your taxes or moved, you might not get it. The notice doesn’t tell you all the ways you can fix the problem or get the revocation reversed. After certification for seriously delinquent tax debt, the taxpayer will receive a letter from the Department of State saying they can’t get a passport. They need to contact the IRS within 90 days to resolve the debt. The letter does not explain how to fix the debt or how to get a passport in an emergency. The Department of State can also revoke or limit an existing passport. If a limited passport is issued, it only allows for return travel to the U.S. If you owe more than $52,000 in taxes, the IRS can certify you as having a “seriously delinquent tax debt,” which has serious consequences. However, there are some exceptions, like if you’re on a payment plan or have an offer in compromise settlement. If the IRS certifies you by mistake, you can challenge it in Tax Court or federal district court. When the statute about seriously delinquent tax debt was first enacted, there were a lot of questions about who would be included and who would be exempt. The IRS responded to criticism by allowing some discretionary exemptions, like if the tax debt is currently not collectible, or if it’s a result of identity theft. These exemptions might change in the future, so they can’t be relied on forever. The IRS takes installment agreement and offer in compromise requests seriously. They may consider a request to be frivolous if the amount proposed is too low or if the taxpayer has not complied with past agreements or filings. If the IRS finds that a tax debt has been paid off, doesn’t meet the seriously delinquent tax debt criteria, or if there are other special circumstances, they can reverse the certification of the debt. This can happen automatically or by request, but it’s always best to double-check with an IRS representative. If a taxpayer believes their certification for passport revocation is a mistake, they can request an expedited reversal if they meet certain conditions. This can be helpful if they have travel plans coming up. There is no other appeal process with the IRS for passport revocation. It’s also important to note that even if some of the taxes are not collectible anymore, it won’t lead to decertification if the rest of the taxes were still collectible when the certification happened. Taxpayers can use the IRS Collection Appeals Program if their tax issue is related to passport revocation, but it won’t immediately reverse the certification. Since passport revocation is new, it’s not clear if the IRS looks at tax proposals more carefully when there’s a passport issue. The Department of State can sometimes use their own judgment to issue a passport if the IRS tells them to. This could happen if someone needs to travel urgently because of a serious situation, like a family member being hurt, being stuck in a dangerous place, or needing medical care. If this happens to you, you can contact the Department of State and ask for help. But the letter you get from the Department of State doesn’t tell you what to do in an emergency. So, if you’re in a tough spot, you might have to call the IRS or Department of State and wait a long time for help. It can be really stressful. If you believe the IRS made a mistake in saying you owe a lot of money in taxes, you can take them to court to prove them wrong. You can file a petition in Tax Court or federal district court. If the court agrees with you, they can tell the IRS to take back the certification. But, filing a lawsuit doesn’t stop the IRS from trying to collect the money from you. There are still some issues that the law doesn’t cover, like whether you really owe the taxes or how long you have to file a lawsuit. Section 7345 does not allow you to challenge the tax debt that led to your passport being revoked. The government can’t be sued unless Congress says so, and this section doesn’t allow it. If the IRS filed a tax return for you, a tax professional will help you decide if it’s better to settle the debt or file your own returns to lower the amount you owe. Congress didn’t give you another chance to challenge the debt because you already have the right to do so before your passport is revoked. The law is meant to help the government collect taxes, not to let you argue about how much you owe. If you owe a lot of money in taxes, the IRS can take action to collect it, like putting a lien on your property or taking money from your bank account. But they have to give you notice and a chance to argue your case at a hearing before they can do that. If you still don’t pay, they can even take away your passport until you do. Once you’ve had your chance to argue your case, they can’t give you another chance later. Section 7345 doesn’t say how long a taxpayer has to challenge an incorrect certification action, so the general rule is to do it within six years. The IRS says they make decisions based on computer records, but these records can be wrong. The IRS has already sent out a lot of notices to taxpayers, so it’s important to know about this law. This is a list of laws and rules related to taxation in the United States. It includes information about the Fixing America’s Surface Transportation Act and Internal Revenue Code, as well as rules for the Tax Court. It also explains the process for challenging tax liability and the rights of taxpayers in dealing with the IRS. If you want to sue the United States, you have to do it within six years of when the problem started, unless there’s a special rule that says otherwise. This is important for tax issues, like when the IRS tries to collect money from you. There are a lot of complicated rules for this, and it’s a good idea to get a lawyer who knows about tax law to help you. If you don’t follow the rules, you could have trouble getting a passport or other problems. Just make sure you take care of any tax issues on time so you don’t have to deal with these problems later.

Source: https://www.floridabar.org/the-florida-bar-journal/passport-revocation-for-seriously-delinquent-tax-debt/