The Tax Times: IRS Resumes Delinquent Debt Passport Certification For Passport Revocation or Non-Renewal

Friday, March 19, 2021

IRS Resumes Delinquent Debt Passport Certification For Passport Revocation or Non-Renewal

On the IRS Operations During COVID-19: Mission-critical functions continue (rev. 3/15/2021), the IRS has said that it is resuming programming for notifying the State Department of taxpayers certified as owing seriously delinquent tax debt following the temporary suspension of certain collection activities with the March 25, 2020, People First Initiative announcement in response to COVID-19.

Beginning The Week Of March 14, Affected Taxpayers Will Receive Notices And Are Encouraged To Pay What They Owe Or Enter Into A Payment Agreement With The IRS
To Avoid Putting Their Passports In Jeopardy.

Affected taxpayers generally owe the IRS more than $54,000 in back taxes, penalties and interest for which the IRS has filed a Notice of Federal Tax Lien and the period to challenge it has expired, or the IRS has issued a levy. As of December 2020, taxpayers previously certified owe on average more than $200,000 in outstanding tax debt, often extending back more than 6 years. The great majority of these are pre-pandemic liabilities and are considered a priority for the IRS due to the amount owed and length of time the taxpayers have been delinquent without working with the IRS to resolve their debts. Per the law, the State Department generally will not renew their passport or issue a new passport after receiving this certification from the IRS, and in some cases may revoke the passport.

IRS offers a number of programs to help taxpayers meet their tax obligations including payment agreements, Offers in Compromise, and, if the IRS determines a taxpayer cannot pay any of their tax debt, a temporary delay of the collection process. When the tax liability is paid in full, the taxpayer has been found to be currently not collectible, or the taxpayer has entered into an installment agreement or has a pending Offer in Compromise, the tax debt is no longer considered to be seriously delinquent and the certification to the State Department is reversed.

Taxpayers Who Have Already Taken Significant Steps
To Resolve Their Debt

Can Still Resolve Their Passport Issues By Contacting
TAS, Who Can Request Manual Decertification.

The memo tells TAS employees to elevate a case to the employee's Local Taxpayer Advocate (LTA) if the case meets all the following criteria. The taxpayer has 1) Imminent foreign travel plans, lives abroad, or has another compelling need for the passport 2)A significant risk of being certified before TAS will be able to help resolve the taxpayer's debt; and 3) Taken demonstrable recent steps to get into compliance with the IRS that nevertheless fall short of the statutory and discretionary exclusions.

Then IRM 13.1.24.8.5.3, Decertify the Debt with the Department of State, is superseded and replaced with the following:

Once the taxpayer meets a criterion for decertification under IRM 5.19.1.5.19.9, Reversal of Certification, review IRM 13.1.24.8.8 to determine if the account will require manual decertification. If so, send an OAR to the SB/SE Passport Office seeking manual decertification.
If the taxpayer has an imminent need for a passport as defined in IRM 5.19.1.5.19.9.1, Expedited Decertification, gather the supporting documentation described. If the IRS function that resolved the debt did not complete and sign page one of Form 14794, Expedited Passport Decertification, prepare the form for LTA signature on page one.
Send an expedited OAR to *SBSE Passport Group mailbox, requesting that the taxpayer be decertified within one business day. Include the signed Form 14794 and the required documentation. If the OAR is not complied with timely, or if you disagree with the response, immediately elevate the case to your LTA for issuance of a TAO.

If You Face This Problem, You Should Consult with Experienced Tax Attorneys, As There Are Several Ways Taxpayers Can Avoid Having the IRS Request That the State Department Revoke Your Passport.