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IRS Revocation or Denial of Passport if you Owe Taxes

What you need to know

Updated information. Did you know that if you owe the IRS money, the U.S. Internal Revenue Service (IRS) can revoke or deny your passport? IRS revocation or denial of passport is actually more common than what you might imagine. Here’s what you need to know if it happens to you.

How the passport revocation or renewal denial process works

Fortunately, this serious threat to your passport status does not apply to you if you owe less than $51,000. You first must reach tax delinquency of the U.S. Congress-specified amount of $51,000 or more before your debt becomes a threat to your passport.

At $51,000 or more you are considered a “seriously delinquent tax debtor”.

The future of passport control. Video: YouTube.

1st Step: Letter from the IRS

IRS Offer of Compromise

You will first receive a notice from the IRS to give you a chance to respond and clear your debt, perhaps working out a payment plan, or an Offer in Compromise?

At that point, you should have several options for settling your debt.

Help processing an Offer of Compromise

If you want help, you can do a Google search for “tax relief” or “tax resolution”. Then you can find an attorney or someone else professionally qualified to help you in your area.

Having professionals help you with your Offer of Compromise may even be able to settle your debt with the IRS for pennies on the dollar.

However, these tax resolution companies usually require that you owe the IRS $10,000 or more before they’ll take your case. After all, they are business to make money.

The amount of their fee is usually proportional to what you owe the IRS.

Special circumstances

The IRS does, however, will consider certain exceptions that would not result in your case proceeding to the State Department level.

There will be no action taken on your passport if you are a victim of unforeseen circumstances, or even fraud.

For example, if you are a victim of a natural disaster, or going through a bankruptcy your valid passport-status may be safely within reach.

irs revocation or denial of passport
Two females abroad. Photo: Unsplash.

2nd Step: The U.S. State Department

If the IRS is not getting a resolution to your case, they may report your tax delinquency to the U.S. State Department.

You see, the IRS is not the agency that will physically revoke your passport or deny your passport renewal; the State Department does that.

The IRS would notify the State Department to revoke your passport.

At this point the State Department may revoke your passport until your IRS debt-problem has been resolved.

What if you are abroad when the State Department revokes your passport?

irs revocation or denial of passport
Don’t panic if you find out your passport is being revoked while abroad. There are solutions. Photo: Unsplash.

Being abroad when action is taken against you does not mean you are now stuck in that country. If the State Department revokes your passport while you are on the beach in Tahiti, sipping on your Mai Tai, continue enjoying the moment!

The State Department will issue you a “Limited Passport” which will replace your revoked passport.

The limited passport would be a valid replacement passport, but only to get you back to the U.S.

What if my passport was revoked, but now I have an agreement with the IRS?

As soon as you make a settlement agreement with the IRS they will do what they call a “decertification”. At that point, they will notify the State Department that your case has been satisfactorily updated.

The IRS then notifies the State Department within 30 days.

Once the State Department clears you, your passport status will again allow you to travel abroad with no restriction. You will also be able to renew your passport without restrictions.

So, what do you think about the power that the IRS has over you to decide on possible revocation or denial of passport if you owe the IRS money from backtaxes? You can send your comments here.

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