We previously posted on Thursday, May 31, 2012 Tax Delinquents May Have Passports Canceled & Be Questioned at Air & Sea Ports  where we discussed that almost unnoticed, Congress is close to approving a law under which the Internal Revenue Service (IRS) will be able to revoke the passports of Americans who owe substantial unpaid taxes. Nothing has happened until now.

A GAO report found that for the 2008 tax year, the State Department issued passports to more than 224,000 citizens who owed about $6 billion in tax. Most of it was for individual income taxes, and nearly two-thirds was more than three years old.  The biggest Tax Debtor owed $46.6 million and was part-owner of a professional sports team. Another owed nearly $40 million and had traveled to 10 foreign countries in the recent past. The report said that the IRS had filed tax liens against both individuals but large amounts of tax still were uncollected.

 

Currently, if a taxpayer has an outstanding tax debt but can't be found, the IRS can alert Homeland Security officials to question the person on his way into the U.S. Typically, they will ask where the person is going and for how long, so the IRS can get in touch, but they can't arrest a taxpayer.
IRS Tax Liens are almost automatic.  The IRS can file a Notice of Federal Tax Lien after: 1. It assesses the liability, 2. They send you a Notice and Demand for Payment and 3. You fail to fully pay within 10 days.

A tax lien can be issued in error. Even where there is no mistake and the IRS lien is valid, occasionally the person might not actually owe the taxes and may just need to straighten out some paperwork. 
 

Recently the bill, known as the Trade Facilitation and Trade Enforcement Act of 2015 (S. 1269), was approved by on May 13, 2015.

It includes amendments to the tax code that would allow authorities to revoke or deny the passport of any US taxpayer who has unpaid taxes in excess of $50,000 or who have not obtained or won’t provide a Social Security number.

The concept is hardly new as we discussed above, similar proposals tying passports to tax liability have been kicked around the halls of Congress for several years.

An advocacy group for U.S. expatriates, American Citizens Abroad, wrote a letter to congressional leaders to strongly oppose the inclusion of the passport revocation provision in the legislation. 

It has been argued that this is an illegal infringement on a US citizen’s right to travel and is unconstitutional. Others fear that this provision could result in administrative nightmares and glitches that could hold up lines at airports and the Hill has expressed doubts that this bill will ever make it to President Obama’s desk.

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Forbes

IRS Owes $234M To Sovereign In Tax Row, Judge Rules

  

1. Chile,
2. Hungary, 
3. Poland,
4. Japan,
5. Luxembourg,
6. Spain, 
7. Switzerland, and
8. the proposed protocol amending the multilateral Convention on Mutual Administrative Assistance in Tax Matters,

were approved on November 11, 2015 by the Senate Foreign Relations Committee, but their fate on the Senate floor remains uncertain.

The treaties, which also include agreements with Chile, Hungary, Spain, and Poland, as well as an international convention on mutual assistance on tax matters, were approved by unanimous consent. However, the chief opponent to passage of new tax treaties, committee member Rand Paul (R-Ky.), wasn't present at the markup.

1. The Committee scheduling a date to meet to report on the eight tax agreements, out of committee and send them to the full Senate for consideration.
2. Once that occurs, the Senate must give its advice and consent to ratification with a two-thirds majority vote.
3. After the Senate takes action, the President must sign an instrument of ratification to complete the approval and ratification process in the United States.

 

Once either:

• The Swiss Banks disclose an account holder's name to the IRS under the non prosecution agreement or 
• Mr. Andreas Bachmann or Josef Dorig or Markus Walder or Susanne Ruegg-Meier or Roger Schaerer discloses an account holder's name to the IRS or
• Any 1 of the other 11 Credit Suisse Bankers, who were indicted in 2011 along with Mr. Dorig, discloses an account holder's name to the IRS 

the OVDP election is no longer available to that account holder!!!

 

Taxpayers Who Wish To Take Advantage

Of The OVDP Must Act Quickly!  

Have Un-Reported Income From a Swiss or OECD Country Bank?

 

Value Your Freedom?

Contact the Tax Lawyers at

Marini & Associates, P.A.

 

for a FREE Tax Consultation Contact US at 

www.TaxAid.us or www.TaxLaw.ms

or Toll Free at 888-8TaxAid (888 882-9243).

 

 
Sources
 
EY
 
Reuters