The Senate has unanimously approved a provision to a highway transportation bill that would revoke the passports of people with seriously delinquent tax debts.
The provision, which was part of a larger amendment by Senate Majority Leader Harry Reid, D-Nev., to the Senate version of a surface transportation bill, was approved by unanimous consent last Tuesday. The amendment would allow the State Department to deny, revoke or limit a passport for any individual whom the Internal Revenue Service has certified as having a “seriously delinquent tax debt” in excess of $50,000. The amount would be adjusted for inflation in future years.
A seriously delinquent tax debt would be one for which a notice of a federal tax lien or a notice of a levy has been filed. However, there is an exception when the debt is being paid in a timely manner under an agreement with the IRS, or if collection on the debt has been suspended because of a collection due process hearing or other relief has been requested or is pending.
The same highway transportation bill also contains a separate amendment aimed at curbing offshore tax abuses (see Senate Passes Amendment to Fight Offshore Tax Abuses). A vote on the overall highway bill is expected this week in the Senate. The House is expected to take up the bill in the coming weeks.
1 Comment
Thanks for drawing attention to this provision. Once these things get passed, you have to wonder how much they will be tweaked in the future. At first blush, you think, that is no big deal right, and then you begin to consider the implications and wonder...
This linking up of State Department functions with the IRS has some ominous implications for the future, I think.
There are a couple questions that I have seen on the Isaac Brock web site might be considered. (see below) There are probably good answers to these, but it does get you thinking about what this means.
Also, when I see all the penalties that are being increased and added in the Transportation bill related to many other things, you begin to understand that buried in some future bill they could lower the tax deficiency requirements and/or add new provisions to lock down the ability of citizens to travel, or add that all arriving citizens be check in immigrations for tax compliance, and you would never know it happened unless someone like you found it buried in 100s of pages of Statutes. Grrr...
Questions: What is the intention of Congress? Does this apply to people who have no tax debt resulting from income earned in the US, but who might have potential "tax debt" on income already taxed abroad but not reported in the US Citizenship taxation regime? What about those who are bone fide foreign residents abroad and might have assessed or potential assessment of FBAR penalties or the like? Is that included?
Wouldn't denial of a passport amount for someone living overseas amount to the same thing as a unilateral revocation of citizenship? Then it seems to me that the bill's enactment would bring the U.S. around full circle? It would basically make a U.S. person stateless.
Posted by: Just Me | March 14, 2012 4:02 AM
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