A few weeks ago, the IRS put out an official news release urging travelers requiring passports to pay their back taxes or enter into payment agreements. And the reason behind this notice? A new procedure that could put your passport at risk if you owe back taxes.
This new procedure comes from the provisions within the Fixing America’s Surface Transportation (FAST) Act, which was passed in December of 2015 but began to take effect last month. One of the provisions in the FAST Act requires that the IRS notify the State Department of any citizens that are “seriously delinquent” on their tax debt.
Once the State Department is notified by the IRS that a citizen has tax debt, they are then required (also because of the PATH Act) to deny that citizen’s passport application or renewal, or even to revoke an existing passport in certain cases.
So, what does “seriously delinquent” mean, exactly? Generally, the IRS defines this as someone who owes the IRS more than $51,000 in back taxes, penalties, and interest and has received a Notice of Federal Tax Lien or Levy because of it.
Those that meet this requirement of being seriously delinquent can be exempt from this new law under some specific circumstances, including currently being in bankruptcy, being identified as a victim of identity theft, being determined as currently not collectable due to hardship, and being located in a federally declared disaster area.
All those who don’t qualify for this exemption will have to settle their debt with the IRS, or otherwise face having their passport put at risk.
If you are a person who qualifies as seriously delinquent on your taxes and you’re worried about your passport, you can avoid the consequences of the FAST Act by paying your debt in full immediately. You can also choose to immediately enter into an installment agreement with the IRS, which would allow you to pay your debt over time and halt any negative actions by the IRS (like a levy, a lien, or being reported to the State Department).
If you are seriously delinquent with your tax debt, there are many options for you to take to resolve your debt and save your passport from being revoked, even if you can’t pay your debt in full immediately. At Vanguard Tax Relief, we are experts at resolving complicated tax issues. Our experienced staff of tax experts understands every aspect of tax law and can look at your unique situation to find the perfect solution for you. Seeking help from an expert in tax resolution can help you quickly resolve your tax debt, as quickly and efficiently as possible, and can— in certain cases— allow you pay far less to the IRS than the amount you think you owe.
If you have serious tax debt, don’t wait to resolve it. The sooner you act on resolving your tax debt, the sooner you can get relief from the stress of being in trouble with the IRS. Contact Vanguard Tax Relief now to get a free consultation with one of our tax experts and start getting yourself out of debt today.