On February 11, 2017, while we were sleeping, our right to travel freely was revoked by the new administration. A new law took effect that allows the Internal Revenue Service to prevent American citizens from traveling abroad if they have a tax liability of $50,000 or more.
“26 USC 7345: Revocation or denial of passport in case of certain tax delinquencies
(a) In general
If the Secretary receives certification by the Commissioner of Internal Revenue that an individual has a seriously delinquent tax debt, the Secretary shall transmit such certification to the Secretary of State for action with respect to denial, revocation, or limitation of a passport pursuant to section 32101 of the FAST Act.
(b) Seriously delinquent tax debt
(1) In general
For purposes of this section, the term “seriously delinquent tax debt” means an unpaid, legally enforceable Federal tax liability of an individual-
(A) which has been assessed,
(B) which is greater than $50,000, and
(C) with respect to which-
(i) a notice of lien has been filed pursuant to section 6323 and the administrative rights under section 6320 with respect to such filing have been exhausted or have lapsed, or
(ii) a levy is made pursuant to section 6331.”
A, B and C must occur before the Commissioner of the Internal Revenue Service may send a certification to the Secretary to revoke or limit your passport. Some exceptions apply, such as:
- You are paying pursuant to an agreement to which you are a party under section 6159 or 7122 of the code, or
- You requested a due process hearing or one is pending. Basically you requested a hearing arguing that you either don’t owe the debt, you don’t owe that amount, or you were never given proper notice, or
- You filed a joint return because you are/were married and you request that you, as a spouse/ex-spouse, be given relief for numerous reasons under section 6015 (b) and (c) of the code.
This new tax law affects U.S. citizens living within the states and abroad. Make sure your tax liability is satisfied or you have a written repayment agreement and that you file your taxes each year. Right now the amount is $50K but that is subject to change. So protect yourself and your family. Stay diligent with your taxes for you and your businesses. If you have not filed your taxes for prior years, now is the time to do so. I’m sure the next revocation law will pertain to student loan debt, so watch out for that as well.