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As of December 2015, the Fixing America’s Surface Transportation Act (FAST Act) (Pub. L. No. 114-94) was signed into law. According to the IRS.gov website and the Bloomberg BNA Tax Management Memorandum, 58 TM Memorandum 383, 9/18/17 (Copyright 2017), the law includes a provision 26 U.S.C § 7345. The law authorized the Secretary of the Treasury to certify certain “seriously delinquent tax debts,” (SDTD) in excess of $50,000 that once certified shall be transmitted to the Secretary of State for action such as, the revocation or denial of passports for individuals meeting certain criteria. An SDTD is defined as an individual’s unpaid, legally enforceable, federal tax debt totaling more than $50,000 (including interest and penalties) for which a Notice of Federal Tax Lien has been filed and all administrative remedies under IRS § 6320 have lapsed or been exhausted, or a levy has been issued.
There are exceptions to this provision and they include tax debt:
- Being paid in a timely manner under an Installment Agreement entered into with the IRS
- Being paid in a timely manner under an Offer In Compromise accepted by the IRS, or a Settlement Agreement entered into with the Justice Department
- For which a collection due process hearing is timely requested in connection with a levy to collect the debt
- For which collection has been suspended because a request for innocent spouse relief under IRC § 6015 has been made.
This provision is a serious matter, specifically for those taxpayers that owe taxes in excess of $50,000—especially those that travel internationally and do not meet the exceptions. The law will require the cooperation of the Department of State and the Internal Revenue Service. At this time, IRS regulations are pending, but the information is on their website, therefore taxpayers with these issues should be aware and seek advice.
If you or your client are in need of a knowledgeable retired IRS Special Agent and forensic accountant for help on a compliance audit with “fraud indicators” and “affirmative acts;” or you require assistance with a criminal investigation call Edmond J. Martin Chief Investigator, at Sage Investigations, LLC call 512-659-3179 or email edmartin@sageinvestigations.com and visit our website at www.sageinvestigations.com.
