When enforcement begins on a little-discussed law, Americans with big tax debts could be planning a stay-at-home vacation—stuck without a passport.
The law, HR 22, instructs the IRS to report citizens owing more than $50,000 to the State Department, which can then yank the debtor’s passport.
“This is definitely something people need to be aware of if they travel extensively,” Thomas Hammerschmidt, a partner in the Ann Arbor, Michigan, office of Dickinson Wright PLLC told The Voyage Report.
Hammerschmidt, who specializes in taxation matters, said he is waiting to advise his clients on the issue once the law takes effect, which could be any day. In response to an inquiry from The Voyage Report, the IRS would not provide a precise date for when it will begin reporting tax debt information to the State Department.
The IRS website says only that the law goes into effect in “early 2017,” and has not been updated to indicate an exact date.