U.S. IRS starting to revoke passports

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U.S. IRS starting to revoke passports

Post by admin » Wed Aug 14, 2019 4:04 pm

the other shoe is dropping.

well seems the u.s. IRS is starting to revoke or deny passports for debts up to $52,000 u.s. They have sent out 400,000 letters.

https://www.cnbc.com/2019/08/13/taxpaye ... voked.html

FYI, even if you qualify for citizenship in chile, you can not apply without a valid passport.

Apply for your chilean citizenship as soon as you qualify; better to have it and not need it.
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Re: U.S. IRS starting to revoke passports

Post by mem » Wed Aug 14, 2019 9:38 pm

As the article points out...expats may not get the letter from the IRS. There should be a way to proactively check if you are on their naughty list

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Re: U.S. IRS starting to revoke passports

Post by snobrd4life » Thu Aug 15, 2019 9:29 am

mem wrote:
Wed Aug 14, 2019 9:38 pm
As the article points out...expats may not get the letter from the IRS. There should be a way to proactively check if you are on their naughty list
Mix-ups at the IRS are inevitable, but I can't imagine that being in that kind of debt with the IRS would come as a an overnight surprise. If you are making enough money to owe that kind of tax bill in less than 1-2 years, you should already be proactively managing your filing and know what is going on.

Even more of a reason why limited as it may be, the miSII website can be super useful. Handling taxes and contibuciones from outside Chile is a piece of cake. I'm sure it would cost a billion dollars for the IRS to implement something similar.
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Re: U.S. IRS starting to revoke passports

Post by admin » Thu Aug 15, 2019 11:12 am

snobrd4life wrote:
Thu Aug 15, 2019 9:29 am
mem wrote:
Wed Aug 14, 2019 9:38 pm
As the article points out...expats may not get the letter from the IRS. There should be a way to proactively check if you are on their naughty list
Mix-ups at the IRS are inevitable, but I can't imagine that being in that kind of debt with the IRS would come as a an overnight surprise. If you are making enough money to owe that kind of tax bill in less than 1-2 years, you should already be proactively managing your filing and know what is going on.

Even more of a reason why limited as it may be, the miSII website can be super useful. Handling taxes and contibuciones from outside Chile is a piece of cake. I'm sure it would cost a billion dollars for the IRS to implement something similar.
one fbar fine, or one facta fine, is over $50,000 u.s.

here is how simple it is for them to do this.

you open an account in a foriegn country. you wire money to that account from your u.s. account. you either don't know, don't remember, or don't how to correctly file all the documents you are required to report each year, even if you owe ZERO TAXES.

The IRS has all the evidence to fine you, provided by the u.s. financial institution and a corresponding foriegn institution report under fatca.

they send a notice to your last known address in the u.s. (which in the case of expats could be years or decades old). you don't receive it. after i bit of time, they send the report to the state department to cancel your passport.

All of this is fully automated. no humans involved.

you have effectively become stateless person and had your citizenship cancelled.

you probably will not find out until you try to cross an international boarder, and your passport is rejected.

this has nothing to do with owing tax to u.s.
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Re: U.S. IRS starting to revoke passports

Post by eeuunikkeiexpat » Thu Aug 15, 2019 11:48 am

Now, the IRS will actively begin referring unresolved cases to the State Department for potential revocation, IRS spokeswoman Cecilia Barreda told CNBC.
The IRS spokesperson said “potential revocation”. It’s only potential because it can’t happen unless and until State can do so — and State will only be able to do so under limited circumstances even for those who are already subject to not being able to get a new/renewal passport application fulfilled due to the law that led to passport denial for US citizens with such tax problems.

This could change, and repeatedly at that, but it’s a question of how and how soon.

FAST isn’t generating as much money for the UST from US passport denial as was used an excuse to put it in FAST. Can’t say I’m surprised.
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Re: U.S. IRS starting to revoke passports

Post by snobrd4life » Thu Aug 15, 2019 3:39 pm

admin wrote:
Thu Aug 15, 2019 11:12 am

one fbar fine, or one facta fine, is over $50,000 u.s.

here is how simple it is for them to do this.

you open an account in a foriegn country. you wire money to that account from your u.s. account. you either don't know, don't remember, or don't how to correctly file all the documents you are required to report each year, even if you owe ZERO TAXES.

The IRS has all the evidence to fine you, provided by the u.s. financial institution and a corresponding foriegn institution report under fatca.

they send a notice to your last known address in the u.s. (which in the case of expats could be years or decades old). you don't receive it. after i bit of time, they send the report to the state department to cancel your passport.

All of this is fully automated. no humans involved.

you have effectively become stateless person and had your citizenship cancelled.

you probably will not find out until you try to cross an international boarder, and your passport is rejected.

this has nothing to do with owing tax to u.s.
I have no doubt that you have plenty more experience/perspective in how things could go horribly wrong. I hadn't considered fines that are levied and due immediately, just tax debt.
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Re: U.S. IRS starting to revoke passports

Post by nwdiver » Thu Aug 15, 2019 3:54 pm

admin wrote:
Thu Aug 15, 2019 11:12 am
snobrd4life wrote:
Thu Aug 15, 2019 9:29 am
mem wrote:
Wed Aug 14, 2019 9:38 pm
As the article points out...expats may not get the letter from the IRS. There should be a way to proactively check if you are on their naughty list
Mix-ups at the IRS are inevitable, but I can't imagine that being in that kind of debt with the IRS would come as a an overnight surprise. If you are making enough money to owe that kind of tax bill in less than 1-2 years, you should already be proactively managing your filing and know what is going on.

Even more of a reason why limited as it may be, the miSII website can be super useful. Handling taxes and contibuciones from outside Chile is a piece of cake. I'm sure it would cost a billion dollars for the IRS to implement something similar.
one fbar fine, or one facta fine, is over $50,000 u.s.

here is how simple it is for them to do this.

you open an account in a foriegn country. you wire money to that account from your u.s. account. you either don't know, don't remember, or don't how to correctly file all the documents you are required to report each year, even if you owe ZERO TAXES.

The IRS has all the evidence to fine you, provided by the u.s. financial institution and a corresponding foriegn institution report under fatca.

they send a notice to your last known address in the u.s. (which in the case of expats could be years or decades old). you don't receive it. after i bit of time, they send the report to the state department to cancel your passport.

All of this is fully automated. no humans involved.

you have effectively become stateless person and had your citizenship cancelled.

you probably will not find out until you try to cross an international boarder, and your passport is rejected.

this has nothing to do with owing tax to u.s.
You are still a US citizen, just no travel document......they can't make you stateless, I think they are a signatory of the UN convention on statelessness.....maybe Trump will lose the election and his passport on the same day.....
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Re: U.S. IRS starting to revoke passports

Post by admin » Thu Aug 15, 2019 4:05 pm

sorry, should have been more clear. They make you "functionally" stateless. supreme court stopped the u.s. government from canceling citizenship outright a long tome ago.

so, instead they carefully crafted FACTA, and related laws to essentially work around that restriction.

try opening a bank account without a passport outside the u.s.; or apply for residency; or, buy a house, etc. just ask the poor Venezuelans what being "functionally" stateless is like; bet it works a whole lot like being actually stateless.

As my father (former prosecutor and defense attorney), was fond of saying, "no one can make you do anything; but, they sure as hell can make you wish you had".

for all those just getting caught up on the history of this, one of the many long threads on the subject going back years:

viewtopic.php?t=7692

search will show many more discussions.
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Re: U.S. IRS starting to revoke passports

Post by Zenth » Fri Aug 16, 2019 8:10 am

The process is not as automated as one may think. Penalties are based on balances. Transfers between accounts are not double counted. This requires input from the account holders. Besides, if you owe taxes, your USA bank probably received a Notice of Levy before the passport revocation applies. That, you will be aware of as I'm certain most of us check their bank balances on line frequently.
Penalties are also asserted based upon the previous actions of the account holders. They can range from zero to 50% of the account balance.
The "Foreign" bank will attempt to contact you. They probably have more recent contact information than the IRS, especially if you stopped filing tax returns. The foreign bank will also advise you of your obligation to be tax and reporting compliant as they will know you're a USA person when you open the account. Your passport shows your country of birth. If you have renounced your citizenship, you'll have a document stating that.
Buried deep in the tax code is the requirement to update your address with the IRS even if you do not have to fie a tax return. Believe it or not, they have a form for that.
And, as usual, ignorance of the law is not excuse.

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Re: U.S. IRS starting to revoke passports

Post by admin » Fri Aug 16, 2019 10:18 am

I think you are giving the u.s. irs way too much credit.

but, let's see how this goes. probably a year or two before this rea3ramps up, and lots of stories start getting published.
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