By Ayar Law
The IRS can now inform the State Department of your delinquent tax debt, and this could lead to a passport revocation or denial. However, your tax debt can only result in a passport revocation if it is considered “seriously delinquent”.
Tax debt is seriously delinquent if you owe over $51,000 (adjusted for inflation) in combined taxes, penalties, and interest. The IRS must also file a Notice of Federal Tax Lien or issue a levy on your property before the tax debt will be certified to the State Department.
If you value your passport and have tax problems, take corrective action to avoid a passport revocation or denial.
Ways to Avoid a Passport Action
You can avoid a passport action by making sure your balance stays below the seriously delinquent threshold, but only if you do so before certification takes place. Once your tax debt is certified to the State Department, the certification won’t be reversed by paying your balance below the threshold.
You can also avoid a passport action using any of the following strategies:
- Make monthly payments with an IRS installment agreement
- Make payments under an accepted Offer in Compromise
- Request a collection due process hearing for a levy action
- Request innocent spouse relief
- Have your account declared currently not collectible
- File for bankruptcy
Even if you owe more than the seriously delinquent threshold, the IRS won’t certify your tax debt to the State Department if you take any of these actions and honor your commitments.
You can also delay certification by requesting an installment agreement or Offer in Compromise because the IRS won’t initiate a passport action while your request is pending.
How to Reverse Certification
The rules are a little different if your tax debt has already been certified as seriously delinquent. You should receive an IRS notice in the mail when your tax debt is certified to the State Department.
At this point, you won’t be issued a new passport, and the State Department has the ability to revoke your current passport. You’ll need to work out a deal with the IRS to have the certification reversed. Even if you are required to hold a passport to keep your job, the IRS won’t reverse certification unless your play by their rules.
If you can pay your balance in full, the IRS will reverse the certification. You’ll also get your passport back if the tax debt becomes unenforceable, such as when the collections statute of limitations expires.
More commonly, you’ll have to submit an installment agreement request or an Offer in Compromise to get your passport back. The terms of these arrangements vary depending on your financial situation. Consult with a tax resolution attorney if you need help sorting out your options and negotiating a deal.
If you request innocent spouse relief or a collection due process hearing, your certification may also be reversed. However, certification won’t be reversed if your request involves debt that is not the basis for certification.
Act Before Your Debt Is Certified
Keep your passport safe by taking action before your tax debt is certified to the State Department. Contact Ayar Law by calling 248-262-3400 to set up your case evaluation with one of our tax attorneys.