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Can I Lose My Passport Due to Unpaid Taxes? (Part 2 of 2)

Reblogger Bill Salvatore - East Valley
Real Estate Agent with Arizona Elite Properties SA545073000
Original content by Dwayne Briscoe

The IRS will reverse a certification when:

- The tax debt is fully satisfied or becomes legally unenforceable

- The tax debt is no longer seriously delinquent

- The certification is erroneous

- The IRS will make this reversal within 30 days and provide notification to the State Department as soon as practicable. The IRS will not reverse certification if a taxpayer’s request for a collection due process hearing or innocent spouse relief is on a debt that's not certified. Also, the IRS will not reverse the certification because the taxpayer pays the debt below the threshold.

 Referral to Revoke Passport

The IRS may ask the State Department to exercise its authority to revoke a taxpayer’s passport.  For example, the IRS may recommend revocation if the IRS had reversed a taxpayer’s certification because they promised to pay and failed to do so. The IRS may also ask the State Department to revoke a taxpayer’s passport if there are offshore activities or interests that could be used to resolve seriously delinquent debt, but the taxpayer does not utilize such resources.  Before the IRS sends a revocation referral to the State Department, the IRS will send taxpayers Letter 6152 asking them to call the IRS within 30 days to resolve their account to prevent this action. 

Judicial Review of Certification

The State Department is held harmless in these matters and cannot be sued for any erroneous notification or failed decertification under the law. If the IRS certified a taxpayer’s debt to the State Department, they could file suit in the U.S. Tax Court or a U.S. District Court to have the court determine whether the certification is erroneous, or whether the IRS failed to reverse the certification when it was required to do so. If the court determines the certification is erroneous or should be reversed, it can order the IRS to notify the State Department that the certification was in error.

The law doesn't give the court authority to release a lien or levy or award money damages in a suit to determine whether a certification is erroneous. Taxpayers are not required to file an administrative claim or otherwise contact the IRS to resolve the erroneous certification issue before filing suit in the U.S. Tax Court or a U.S. District Court.

Payment of Taxes

Taxpayers who can't pay the full amount they owe, they can make alternative payment arrangements such as an Installment Agreement or an Offer in Compromise to have their certification reversed. This is why it's important to make sure that you have some type of plan in place to avoid any type of jeopardy in the event you owe more than the Delinquent Tax Debt Amount which could possibly trigger issues later on. If you need assistance in making sure you have your tax returns filed and a payment plan in place, feel free to contact a tax resolution expert with Bookkeeping-Results, LLC to help you with your specific needs.

 

 

Dennis Neal
Exp Realty of Southern California, Inc. - Big Bear Lake, CA
Your Home Sold in 21 Days or We Sell It For Free

This is an informative post, Bill! Understanding the potential consequences of unpaid taxes, especially regarding passport revocation, is crucial for anyone planning to travel or manage assets abroad. It's reassuring to know that there are options like Installment Agreements and Offers in Compromise available for those struggling to pay their tax debt. As a real estate professional in Big Bear Lake, I've seen how financial stability plays a significant role in homeownership and investment decisions. It’s always wise for individuals to stay proactive about their tax obligations to avoid complications down the road. Thanks for shedding light on this important topic!

Oct 10, 2024 11:43 AM
Roy Kelley
Retired - Gaithersburg, MD

Thank you very much, Bill, for sharing this interesting reblog selection.

Oct 11, 2024 12:55 PM