Americans overseas and their advocates in Congress are reacting to a new law that allows the government to void the passport of anyone owing $50,000 or more of taxes.
The bill was designed to authorize funds for federal highways, but an addition addressed the passport issue.
Section 52102 authorizes the Department of State to deny, revoke or limit a passport to any individual upon receiving certification from the Department of the Treasury that such individual has a seriously delinquent tax debt in excess of $50,000.
The idea was to prevent those delinquent in their federal income tax from leaving the U.S.
But two members of Congress have written to John Kerry, the current secretary of State, noting there is a difference between revoking a passport of a citizen in the U.S. and of one living abroad. The members of Congress, Carolyn B. Maloney, a New York Democrat, and Mick Mulvaney, a Republican from South Carolina, are asking their colleagues in the House to co-sign the letter.
The letter outlines for Kerry what it calls the serious issues with regard to the passport revocation provision as it applies to Americans living and working overseas.
For many overseas Americans, a passport is the primary means of identification.
The advocacy organization American Citizens Abroad says it has continued to highlight to the Congress the serious negative impact such legislation could have on Americans living overseas.
The organization said that it is pleased to see that the two representatives understand the concerns over this provision given the increase in individuals coming into compliance from overseas, the lengthy mail delivery and communications time between the Internal Revenue Service and overseas tax filers, the risk of error in filing from overseas and the lack of clear regulatory guidance on how the process for the final determination of those whose passports will be revoked.
The organization urged overseas Americans to contact their representatives in Congress to support efforts to at least clarify the law.
A $50,000 tax debt is not as astronomical as it may seem.The sale of a long-held property could generate such a debt.
Even overseas Americans are supposed to pay capital gains tax on such foreign transactions.
Interest and penalties also can mushroom a tax debt, and the Internal Revenue Service has not shown itself to be very understanding.