In an effort to encourage compliance with tax laws, the Internal Revenue Service (IRS) has the authority to request the State Department to revoke or deny the passport of individuals with seriously delinquent tax debts. If you find yourself facing such an issue, understanding the process can be crucial in ensuring you retain or regain your ability to travel abroad. Below is an in-depth FAQ on the subject:
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**Q: Why would the IRS revoke or deny a passport due to back taxes?**
A: If an individual owes a significant amount of back taxes and hasn't made arrangements to resolve the debt, the IRS considers it "seriously delinquent" and can inform the State Department of the debt. The State Department then has the authority to revoke, deny, or limit the individual's passport.
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**Q: What are the steps to regain or prevent the revocation of my passport?**
A: To prevent or reverse a passport revocation due to back taxes, follow these steps:
1. **File All Back Returns:** Ensure that all your back tax returns are filed, signed, and dated to bring them up-to-date.
2. **Contact the IRS:** Once you've filed your back returns, call the IRS. Depending on your case, they may assign you to a specific agent who will handle your situation.
3. **Fax the Tax Returns:** Fax the completed tax returns to the agent to ensure they have all the necessary paperwork.
4. **Payment Plans:** During your phone call with the IRS or the agent, you'll need to establish a payment plan to clear your debt. This demonstrates a commitment to settling your obligations.
5. **Provide Travel Itinerary:** If you have upcoming travel plans, make sure to provide a detailed travel itinerary. This assures the IRS of your intent to return and continue payments.
6. **Letter from the State Department:** Secure a letter from the State Department regarding your passport situation. This can serve as a verification or clarification document if needed.
7. **Timing is Essential:** Ideally, undertake these steps within 14 to 30 days of your intended travel dates. The IRS and State Department processes might take time, so the sooner you act, the better.
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**Q: Can I travel while my passport is revoked?**
A: If your passport is revoked due to back taxes, you won't be able to use it for international travel. If you're already abroad when the revocation occurs, you might face difficulties returning to the U.S. It's essential to resolve the tax issues promptly to regain your passport.
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**Q: What's the threshold for "seriously delinquent" tax debt?**
A: The threshold for seriously delinquent tax debts can change, but as of the last update, it was set at $50,000, including penalties and interest. This figure is adjusted annually for inflation.
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**Q: Are there any exceptions?**
A: There are exceptions where the IRS will not consider your debt as seriously delinquent. Some include:
- You're in bankruptcy.
- The IRS acknowledges you're a victim of tax-related identity theft.
- Your debt is currently not collectible due to hardship.
- You're in a disaster zone.
- You have a request pending with the IRS for an installment agreement or offer in compromise.
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**Conclusion:**
The possibility of passport revocation due to back taxes can be distressing, especially if you need to travel. However, by understanding the process and taking proactive steps, you can navigate the situation efficiently and work towards a resolution with the IRS. Always consider seeking advice from a tax professional or attorney if you're unsure about any aspect of your tax situation.