03 May Being Compliant with Federal Tax Obligations May Soon Be A Requirement For Passport Renewal
According to a recent Government Accountability Office (GAO) report,Â the State Department issued 224,000 passports to citizens who owedÂ approximately $6 billion in income tax in 2008. Â Purportedly that amount has increased over the last three years. Most of the perpetrators are both wealthy and from my perspective burdened with inflated hubris. If this is you, may God have mercy on your soul. PAY YOUR TAXES!
The current law stipulates that the State Department cannot decline yourÂ application for a new or renewed passport if you still owe taxes. The law also forbids the IRS from revealing your taxÂ information to third parties including the State Department without yourÂ consent. The State Department can deny you a passport if there is:
- a warrant forÂ your arrest,
- a court order disallowing you from leaving the US, or
- a requestÂ for your extradition.
- a failure to pay child support of more than $2,500.
In its report the GAO suggested that tax compliance be added to the list ofÂ reasons to decline the application for a passport whether new or renewal with this sentence.Â “If Congress is interested in pursuing a policy of linkingÂ federal tax debt collection to passport issuance, it may consider takingÂ steps to enable State to screen and prevent individuals who owe federalÂ taxes from receiving passports.”
In addition the IRS formed a Global High WealthÂ Industry office charged with investigating tax complianceÂ of wealthy American taxpayers. The number of audits on the wealthy has risen to 2,458 in 2009 among taxpayers who earn $10 million orÂ more a year, an increase of 905 audits from the 2008 figure of 1,553.Â Likewise, the number of audits on taxpayers earning between $1 millionÂ and $10 million increased by approximately 50% to 21,660 over the sameÂ period. If you are professionally or financially successful chances are good that you are being watched and profiled so maintain compliance to protect yourself.