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May 31, 2019


Passport Restrictions

If you travel (or plan to travel) internationally but have substantial tax debt, the IRS has you in its crosshairs as never before.

Under a new law, the IRS is required to use passport restrictions as a tool to collect taxes in certain cases. If you owe $50,000 or more in taxes, and the IRS has already taken formal steps to collect it, you could have your passport taken away or your application for one denied if you don’t resolve the debt.

At Brown PC, we can help you respond to these travel restrictions and work to protect your passport privileges. Call today to discuss your particular situation. Based in Dallas-Fort Worth, our attorneys assist clients across the country and abroad.

What Types Of Tax Debt Affect International Travel?

The new travel restrictions for tax debt apply to what the federal tax code (Section 7345) calls “seriously delinquent” tax debt.

In dollar terms, this refers to federal tax debt of $50,000 or more. Since interest and penalties can be included in that figure, you might be affected by the passport restrictions even if you originally owed less than $50,000 in taxes.

But it isn’t only the size of the debt that makes it “seriously delinquent.” The IRS must also have already filed a lien against you or issued a levy, trying to collect it. In other words, before going after your passport, the IRS must have already taken formal collection actions that have not resulted in resolution of the debt.

Did You Get A Notice From The IRS About Passport Restrictions?

Once the IRS has certified that your debt meets these criteria, it will send notices to you and the State Department about possible passport restrictions. This notice is called letter 508C.

It will take time to determine exactly how the State Department will decide whether to revoke a passport, limit its use or deny an application. What’s clear, however, is that if you receive letter 508C your international freedom of movement is at serious risk.

If your passport application was pending, you get 90 days to take care of the situation before the State Department would deny you a passport. This 90-day period is not available, however, for revocation or limitation of a current passport.

Responding To The Threat To Your Passport

Even if the IRS certified you for passport restrictions, there are ways that a skilled tax lawyer can help you respond and protect your international travel privileges.

The most straightforward way to protect your passport may be to enter into an installment agreement (IA). Under such an agreement, you could pay your debt to the IRS over a period of time – and get the passport restrictions reversed.

But there are also other options. These include requesting a collection due process hearing, working out an offer in compromise (OIC) or even seeking judicial review of the certification.

Skilled Tax Counsel, When You Need It The Most

At Brown PC, our attorneys will work with you to identify the solution that makes the most sense for your specific situation. With our proven ability in complex tax litigation, we will help you find a way forward.

To arrange a confidential consultation, call our office or complete the brief online form.