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April 25, 2012

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Proposed Tax Collection Technique Would Allow Pulling Passports

Can the government restrict your right to travel out of country, just because you have a dispute with the IRS about tax collection?

IRS collection tactics are often aggressive. But a proposed bill in Congress would expand the agency’s authority even further. If the bill is passed and signed by the president, it would enable the federal government to pull passports from people who have unpaid taxes.

As currently written, the proposed bill would do allow this even if someone with unpaid taxes has not been charged with tax evasion – or any other crime.

The bill in question is actually part of a much larger body of legislation regarding the authorization of federal funds for highway projects and transportation programs. The larger legislation is called the Moving Ahead for Progress in the 21st Century Act, or MAP-21 for short.

One provision of the MAP-21 proposal would grant the State Department the power to “deny, revoke or limit” passports rights for certain taxpayers. Under the proposal, those rights could be limited for taxpayers with “serious delinquencies.”

The threshold amount to trigger application of the proposed law would be $50,000 in back taxes.

If the proposal were to become law, the IRS would be allowed to send the names of people who owe back taxes to the passport office. Their passports could be suspended, as long as the IRS had already taken steps to collect the back taxes through a tax lien or tax levy.

The proposed bill contains only a few exceptions, such as for taxpayers who have set up payment plans.

Source: “No Taxes, No Travel: Why the IRS Wants the Right to Seize Your Passport,” Jacoba Christ, the Atlantic,” 4-17-12

IRS Tax Collection