June 9, 2012


A few weeks ago the United States Senate passed a piece of legislation called the “Moving Ahead for Progress in the 21st Century Act”, it is essentially a transportation bill focused on roads and bridges. Title III of the act is a revenue provision concerning gas guzzling, cars leaking underground storage tanks, import duties and a number of other fees, taxes and other revenue enhancements.

Section 40304 is a rather bizarre provision that certainly doesn’t seem to fit in a transportation bill and is buried so deep that few senators have probably even read that far into the bill which is 1676 pages. Section 40304 is titled “Revocation or denial of passport in case at certain tax delinquencies”. The provision specifically amends the 1926 Passport Act to permit the IRS to simply ‘Certify” to the Secretary of State that an individual “has a seriously delinquent tax debt in an amount in excess of $50,000.00. The law does not require that any hearing be held or require administrative due process of any kind. In fact the IRS must only give what is called a “Notice of levy” to the tax payer. This is nothing more than the IRS’ own determination that the taxpayer owes $50,000.00 and while $50,000.00 sounds like a lot of money, it can easily be the case that much smaller amounts with penalties and interest can cross the $50,000.00 threshold.

Read the whole thing.

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