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Passport Privileges

| Nov 22, 2017 | Tax mistakes

Traveling abroad? Make sure your taxes are paid, otherwise you may have to cancel your plans. In enacting the Fixing America’s Surface Transportation Act (“FAST Act”), Congress added § 7345 to the Internal Revenue Code. This section allows the Secretary of State to deny, revoke or limit passports to taxpayers who have “seriously delinquent tax debts.”

A tax debt is considered “seriously delinquent” when it is over $50,000. Here,the IRS has either taken levy action or filed a lien on the balance, and your collectiondue process rights have lapsed or been exhausted. You would also come to know aboutit because your IRS notices will also contain language regarding the passport privilegerestrictions.

To revoke/suspend your privileges, the IRS would send notice to you and the USSecretary of State. The notice would inform you of what is outstanding and how toprotest the same. If the IRS erroneously sent this notice, arguing the issue in courtcould be your only option.

In the event the IRS did not error in making a “seriously delinquent”determination, you can retain passport privileges in three instances: full payment,payment agreement or innocent spouse relief. Once this occurs, the IRS is to reverse itsdetermination by sending notices to both the Secretary of State and to you regardingyour change in status. Generally, the IRS is to send said notice within thirty days of the change.

If you have dreams of cruising through Europe or relaxing on a beach in theCaribbean, check on your delinquent tax debt first. Nobody wants to get turned away atthe airport.