In 2015, Congress passed a bill with various restrictions on individuals with “seriously delinquent tax debt”, after two years of fine-tuning the enforcement details. The bill granted the IRS the power to refuse to renew or invoke the passports of tax defaulters, pushing thousands of people into panic, who were trying to figure out how to solve their tax issues. If you too are grappling with the same situation, the Law Offices of Nick Nemeth, PLLC, is ready to help. Continuing on the subject, we present an overview of all that you can do to prevent IRS passport block. Read on.
1. If you have a dispute with the IRS, appeal
When the IRS sends you any notice, ensure you respond adequately and on time. Be sure to file your disputes for as many continuances from collections as you can get. You can also petition the tax courts to prolong your delay. This will ensure you keep the passport for a long time while keeping the system tied up.
2. Settle your debt with an OIC
Based on your earning and expenses, you can try to service your debt with an Offer In Compromise. You can add up to two years to the collection process by processing and negotiating an Offer In Compromise. Throughout this entire process, the IRS cannot revoke your passport. Be warned, though, that an OIC comes at a cost. The IRS usually has up to 10 years to collect a debt, after which it falls away. The offer in compromise delays this statute, meaning it will extend the collection time much later by compensating the delay.
3. File a bankruptcy
Upon filing for bankruptcy, most of your income taxes get discharged. If your tax debt is older than three years, not resulting from a tax fraud and you filed your bankruptcy two years after filing the tax returns; your debt should be effectively eliminated. Although, not all IRS debt can be discharged in a bankruptcy.
4. Look for permanent residency in a foreign country
This should be done before the IRS takes your passport. Without a permanent residency in a foreign country, the IRS can revoke your passport which will bar you from traveling abroad or even force you to move back home. The IRS won’t force you to return to the US if you are a permanent resident of another country.
5. Discuss an installment agreement with the IRS
Whatever the size of your debt, you can always negotiate an installment agreement with the IRS. The IRS has four different types of installment agreements. Find out which one you qualify for. Small payments for big debts, say a monthly $200 installment for a $1million debt, will prevent an IRS passport block.
Getting an installment agreement and executing other IRS tax appeal processes are complex matters best handled by tax attorneys.. Nick and his team are adept in all-matter-taxes and work around the clock to provide tax relief to its clients by negotiating with the IRS while also offering tips against the IRS traps. If you risk losing your passport, request a no-obligation consultation with one of our IRS tax lawyers. Fill out our contact form or simply call +1-972-484-0829.