As a nation, Americans already have a low rate of passport ownership. Now, thousands more may be denied their passports this year as the government begins to clamp down on people with a large amount of tax debt.
The law states that if you owe more than $51,000 in federal tax – classed as “seriously delinquent” – your passport must be denied or revoked. The rule was passed into law in 2015 by Congress but the Internal Revenue Service (IRS) is just starting to get tough on the legislation and has published new regulations overseeing the process.
Since February this year, the IRS has begun sharing the names of those affected with the State Department in order to help them enforce the law. It’s estimated that around 362,000 people are currently affected by the passport restrictions. The agency confirmed to the Wall Street Journal that people have already been denied passports due to the enforcement.
Once you pay off your debts or arrange an instalment plan to get them cleared, the restriction will be lifted. Already there has been some success, with 220 people choosing to clear the debt immediately and a further 1400 have signed up to pay in instalments in order to receive a new passport.
Technically, the law can go as far as revoking your existing passport. However, for now the IRS has said it will only be applied to brand new passports or renewals. There are exceptions for people who live in a disaster area, who cannot have taxes collected due to hardship, have filed for bankruptcy or have been subject to tax-related identity theft. They will also delay denying your passport if you are serving in a combat zone.