Serious Tax Debts Can Put U.S. Passports in Jeopardy, Tax Resolution Expert Warns

ByRandall Brody Expat Tax Resolution

LAS VEGAS – Oct. 18, 2023 – U.S. residents who owe more than $59,000 in back taxes and are planning to travel abroad should allow at least several months to negotiate a settlement with the Internal Revenue Service or risk having their passports denied or revoked.

Randall Brody, an IRS-enrolled agent and CEO of Tax Samaritan and Peace of Mind Tax Help, says some of his clients still don’t know about the law passed by Congress eight years ago that can disrupt travel plans.

When a person owes more than $59,000, the IRS informs the State Department, which can then deny, revoke, or restrict a passport.

Brody explained how seemingly manageable tax debts can spiral out of control due to penalties and interest.

“A $20,000 tax debt from a few years ago can easily balloon to $60,000,” he said. “When you owe $59,000 or more and can’t pay it off in 90 days, you generally have two choices: enter an IRS installment agreement or propose an offer in compromise. We can assist taxpayers with either choice.”

An installment agreement lets people pay their taxes gradually, avoiding garnishments, levies, or other collection actions. While taxpayers are still responsible for late payment penalties and interest, this option makes payments more manageable.

On the other hand, an offer in compromise lets taxpayers settle their tax debt for a reduced sum compared to the full amount.

Brody said that both of these options require time. Travelers should allocate several months to address their tax debt before traveling abroad.

He also stresses the critical need for swift action when tackling tax debts. “Prompt action can prevent small tax issues from escalating into massive headaches,” he said.

For detailed information on this topic, visit the IRS website at https://www.irs.gov/businesses/small-businesses-self-employed/revocation-or-denial-of-passport-in-case-of-certain-unpaid-taxes.

Income tax expert Randall Brody, the founder of Tax Samaritan and Peace of Mind Tax Help, specializes in solving tax issues for expats. Published regularly in the EA (Enrolled Agent) Journal, Brody has helped more than 9,500 taxpayers and eliminated over $800 million in tax debt. For free tax tips, subscribe at https://qrco.de/taxtips.

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To the Media:

A photo of Randall Brody with a passport is at our website at https://taxsamaritan.com/wp-content/uploads/2023/10/r…. If you need background, commentary, trends, or story ideas about tax issues, please contact him at Randall.Brody@TaxSamaritan.com, 775-305-1040 (office).

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Wrapping It Up

If you’re investing outside the U.S. or considering foreign investments, make sure that you understand the U.S. tax implications. This will help to reduce unnecessary interest and income tax. Remember that the tax rules for U.S. expats are complex and can be confusing. Check with a tax professional to ensure you’re always on top of your tax obligations.

Tax Samaritan aims to provide our clients with the best counsel, advocacy, and personal service. We are not only expat tax preparation and representation experts but strive to become valued business partners. Tax Samaritan understands our clients’ unique needs; every tax situation requires a personal approach to providing realistic and effective solutions.

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Randall Brody

All About Randall Brody

Randall is the Founder of Tax Samaritan, a boutique firm specializing in the preparation of taxes and the resolution of tax problems for Americans living abroad, as well as the other unique tax issues that apply to taxpayers. Here, they help taxpayers save money on their tax returns.