Passport Denials for Taxpayers in Tax Debts


The IRS warned that taxpayers who owe more than $51,000 in tax debts could have their US passport applications or renewals denied until the debts are paid off.

Starting in January, the IRS will start implementing new procedures to crack down on individuals with “seriously delinquent tax debts.” Under the Fixing America’s Surface Transportation (FAST) Act, the IRS is required to notify the State Department of taxpayers that are certified by the IRS as owing a seriously delinquent tax debt. “Seriously delinquent tax debt” is unpaid and legally enforceable federal tax debt totaling more than $51,000, including penalties and interest. Upon receipt of the certification from the IRS, the State Department is generally required to deny a passport application for individuals with seriously delinquent tax debts and may also revoke or limit passports previously issued to those individuals.

There are several ways the taxpayers can avoid having the IRS notify the State Department of their outstanding tax debts. They include:

  • Pay off the debt in full either through an approved installment agreement or an accepted offer in compromise;
  • Pay the tax debt timely under a settlement agreement with the Department of Justice;
  • Request or have a pending collection due process appeal with a levy; or
  • Have a collection suspended under the innocent spouse election or request an innocent spouse relief.

A passport will not be denied if a taxpayer is:

  • in bankruptcy,
  • identified by the IRS as a victim of a tax-related identity theft,
  • determined by the IRS that the account is currently not collectible due to hardship,
  • located within a federally declared disaster area,
  • in the process of requesting an installment agreement or offer in compromise with the IRS, or
  • having an IRS-accepted adjustment that will satisfy the debt in full.

The IRS also indicated that taxpayers who have fallen behind on their tax obligations, and come forward and pay what they owe or arrange a payment plan with the IRS can often qualify for a relief.

For more information about this article, please contact our tax professionals at taxalerts@windes.com or toll free at 844.4WINDES (844.494.6337).