Do You Really Have Severe Tax Debt?

divingdaily
4 Min Read

Many people are surprised to know that you can be denied a passport or that your passport can be revoked because you owe taxes. Delinquency in paying your taxes can have severe consequences. Passport application denial or revocation is one of them.

It makes sense that the IRS would want to prevent anyone who owes a significant amount of taxes from possibly leaving the country forever or for long periods of time. If you have had your passport application denied or had your passport revoked because you owe a severe tax debt, then you need to get the facts.

The IRS  will certify your debt to the State Department so that they can deny or revoke your passport for severe tax debt. You may be wondering what exactly qualifies as severe tax debt. If you owe the IRS taxes in the amount of $54,000 or more you are said to have severe tax debt.

A Notice from the IRS

If you have a severe tax debt the IRS will let you know by sending you what is called a CP508C Notice. When you receive this notice you should open it immediately. The letter will indicate to you how you can resolve your debt with the IRS.

Get in touch with the IRS right away and discuss with them how you can pay off your taxes. The state department will usually give you 90 days to fix any tax issues you are having with the IRS before denying your passport application.

How to Deal with the Debt

The only way to address the issue of a passport denial or revocation due to unpaid taxes is to pay the debt. If you can pay off the debt in full then this would be best but if you are like most people you will probably need a payment plan.

In addition to a payment plan, the IRS may give you an offer in compromise or a settlement agreement. The IRS will reverse the certification of your debt once you have finished paying them or have come into an agreement to pay off the debt.

Reversal of Certification

The certification of your debt is usually reversed by the IRS within 30 days of resolving your tax issues with the IRS. When the IRS has reversed the certification of your debt you will be sent a CP508 Notice.

Once you receive this it means that the state department has been notified of the reversal. Make sure that you keep a copy of this notice for your record. When you receive the notice you can then apply once again for your passport and it will not be denied.

Handling the IRS

Handling the IRS can be intimidating for anyone especially when you know that you are not necessarily in the right. However, no matter what your situation there are always tax professionals available who can find creative tax solutions to help navigate you through the process.

Seeking professional help will not only give you peace of mind but will help to ensure that the matter is resolved as quickly as possible.

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