Can I Get a Passport if I Owe Taxes?
In recent years, the question of whether individuals can obtain a passport if they owe taxes has become a hot topic of discussion. Many people are surprised to learn that their tax debt can pose a barrier to obtaining or renewing their passport. This has led to confusion and frustration among taxpayers who may need a passport for various reasons, such as travel or work. In this article, we will take a closer look at the issue and explore the implications of owing taxes on passport eligibility.
First and foremost, it is essential to understand that the Internal Revenue Service (IRS) has the authority to revoke or deny a passport to individuals who have seriously delinquent tax debt. This is based on the provisions of the Fixing America’s Surface Transportation (FAST) Act, which was signed into law in 2015. Under this law, the IRS can notify the State Department of taxpayers who owe more than $50,000 in back taxes, penalties, and interest. Once the State Department receives this notification, it can deny the individual’s passport application or renewal, or even revoke an existing passport.
It is important to note that the $50,000 threshold includes not only the principal amount of the tax debt but also any penalties and interest that have accrued. This means that a taxpayer who owes $40,000 in back taxes but has accrued $15,000 in penalties and interest would also meet the threshold for seriously delinquent tax debt. The IRS considers tax debt to be seriously delinquent if it meets or exceeds the $50,000 threshold and has been assessed by the agency.
If a taxpayer’s passport application or renewal is denied or their existing passport is revoked due to seriously delinquent tax debt, they will receive a Notice CP 508C from the IRS. This notice will inform them of the reason for the denial or revocation and provide instructions on how to resolve the tax debt. In most cases, taxpayers will need to enter into a payment plan with the IRS to address the outstanding balance and bring it below the $50,000 threshold. Once the tax debt is resolved, the IRS will notify the State Department, and the individual’s passport eligibility will be restored.
It is worth noting that the IRS is required to provide advance notice to taxpayers before certifying their seriously delinquent tax debt to the State Department. This gives individuals an opportunity to address the issue before it impacts their passport eligibility. In addition, certain taxpayers may be exempt from passport denial or revocation, such as those who are in bankruptcy proceedings, victims of tax-related identity theft, or who have a pending offer in compromise with the IRS.
While the FAST Act has given the IRS new tools to enforce tax compliance through passport denial and revocation, some critics argue that it unfairly targets low-income taxpayers who may be unable to pay their tax debt in full. They argue that the $50,000 threshold does not take into account taxpayers’ ability to pay and could disproportionately impact those with limited financial resources. However, supporters of the law contend that it is an effective tool for incentivizing taxpayers to address their outstanding tax liabilities and fulfill their obligations to the government.
In conclusion, owing taxes can indeed affect an individual’s ability to obtain or renew a passport. The IRS has the authority to deny or revoke passports for individuals with seriously delinquent tax debt, which is defined as owing more than $50,000 in back taxes, penalties, and interest. Taxpayers who find themselves in this situation will need to resolve their tax debt with the IRS to restore their passport eligibility. While the FAST Act may have implications for some taxpayers, it is ultimately intended to promote tax compliance and ensure that individuals fulfill their obligations to the government.
