Travelers who have serious delinquent tax debts exceeding $62,000 may face significant travel restrictions imposed by the federal government. The IRS and Treasury Department are required by law to notify the State Department of individuals with such tax liabilities. Once this notification is made, the State Department may refuse to issue a new passport or even revoke an existing one. This measure, in effect since 2018, is used as a final effort to collect unpaid tax levies.
The consequences of having a passport revoked due to tax debts can be severe for travelers. Individuals with revoked passports may be unable to take trips overseas until the debt is resolved. This can be particularly challenging for expats or business travelers who rely on international travel. In some cases, travelers may be required to return to the U.S. indefinitely until their tax case is settled. The revocation of a passport is considered a measure of last resort to encourage payment of outstanding tax debts.
In recent years, there has been a noticeable increase in enforcement efforts related to passport revocation for tax debts. According to experts in the field, such enforcement activities have become more common and are seen as an effective way to prompt individuals to address their tax liabilities. Travelers who have had their passports revoked often respond by contacting the IRS to resolve their outstanding debts.
While revoking a passport may seem extreme, it is legally permissible for the federal government to do so in cases of seriously delinquent tax debts. Various court cases have upheld the government’s authority to revoke passports as a means of collecting tax liabilities. Prior to revocation, the IRS must have exhausted all other collection activities, such as issuing notices of federal tax liens. Revoking a passport is typically considered a last resort measure after other collection efforts have failed.
Before revoking a passport, the IRS sends the taxpayer a notice (CP508C) outlining the implications of having a seriously delinquent tax debt. If the individual applies for a passport after receiving this notice and has not made efforts to pay the debt, the State Department will generally deny and close the application. Travelers who wish to avoid passport revocation must take steps to resolve their tax debts, such as paying the balance in full, entering into a payment plan, or reaching a compromise agreement with the IRS.
In some cases, individuals may be caught off guard by passport revocation when they attempt to travel. This can happen if the IRS has outdated or incorrect address information for the taxpayer, leading to important notices being sent to the wrong location. Travelers who are unaware of their outstanding tax debts may only discover the issue when they try to leave the country and find that their passport has been revoked.
The potential consequences of ignoring tax bills can have a significant impact on travelers. Passport revocation due to seriously delinquent tax debts is a serious measure taken by the federal government to prompt individuals to address their financial obligations. Travelers should be aware of the implications of unresolved tax debts and take steps to prevent passport revocation by working with the IRS to resolve any outstanding issues. Failure to do so can result in significant travel restrictions and complications when attempting to leave the country.