At the beginning of the year many of us make travel plans for pleasure, business or with family. If these are your plans, you need to be aware of the existence of a new law that may affect your plans.
Currently, the federal government is implementing many changes in its policy and it is feared that an existing law, from 2015, will be put into effect. This law, called Fixing America’s Surface Transportation or more known as “FAST ACT”, was signed by then President Obama on December 4, 2015. The purpose of this law is give to the State Department authority to remove, confiscate, or cancel the passports of persons who have tax debts with the IRS.
This law works as follows; the IRS has no control over passports, these are controlled by the State Department. Taxes are assessed by the IRS; the State Department generally does not have access to taxes information on taxpayers with regard to the privacy law.
To connect the IRS to the State Department, the law now requires the IRS to notify the State Department about taxpayers who owe taxes. Thus, the State Department has the authority to not grant new, renew or cancel passports for major taxes debtors.
According to the law, a “major tax debtor” is who has not paid his/her taxes of more than $50,000 or has not filed his/her tax returns, which are legally binding.
If you are in this category under this new law, the IRS is required to notify you in writing that they certified your debt with the State Department. Then, the State Department will retain your passport for 90 days, while allows you to resolve any errors, pay your debt in full or reach a satisfactory payment plan. It is important to have in mind that there is no extension to the 90 days time period.
If you fall into this category, where you owe more than $50,000, the only solution is to pay the debt, have a repayment plan, or be on a Non-Binding Offer process. If you have any doubts about how much you owe in taxes debts, you can contact the IRS or hire an IRS Enrolled Agent to investigate your current tax situation. Remember that if you travel abroad, you can leave the country, but you cannot re-enter.