Here is some news that came across my desk today regarding traveling and tax debt


The Fixing America’s Surface Transportation Act of 2015 (FAST Act) added IRC Section 7345 which requires the State Department to deny or cancel a passport for an individual upon receiving certification from the IRS that the individual has seriously delinquent unpaid tax debt.

Seriously delinquent tax debt is an individual’s unpaid, legally enforceable federal tax debt totaling more than $50,000, including interest and penalties, for which:

  • A notice of federal tax lien has been filed and all administrative remedies have lapsed or been exhausted, or
  • A levy has been issued.

Tax debt that is not considered seriously delinquent includes:

  • Tax debt that is being paid in a timely manner under an installment agreement entered into with the IRS,
  • Tax debt being paid in a timely manner under an offer in compromise accepted by the IRS or a settlement agreement entered with the Justice Department,
  • Tax debt for which a collection due process hearing is timely requested in connection with a levy to collect the debt, or
  • Tax debt for which collection has been suspended because a request for innocent spouse relief has been made.

The $50,000 threshold will be indexed for inflation in future years. The IRS will issue Notice CP 508C to the taxpayer at the time it certifies to the State Department that the taxpayer has seriously delinquent tax debt. The State Department will then hold an application for a passport for 90 days to allow the taxpayer to resolve any erroneous certification issues, make full payment of the tax debt, or enter into a satisfactory payment alternative with the IRS. There is no grace period for resolving the debt before the State Department revokes a passport.

The IRS recently announced that it has not yet started certifying tax debt to the State Department, but expects to begin doing so shortly.

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