Those states skipped the stricter standards for state-issued IDs. As a result, the TSA could insist on passports rather than driver’s licenses to board flights. The TSA will accept $55 passport cards and $135 passport books as valid identification. But some advice says that people in Minnesota should get passports by January 2016 to fly domestically. New York has been granted a waiver, so any driver’s license should still work. Louisiana has a waiver until Oct. 10, 2016, meaning that existing driver’s licenses work there too. Ditto for New Hampshire which has a waiver until June 1, 2016.
The easy answer may be to dig out your passport to avoid any doubt. Yet the IRS may have something to say about whether your passport is any good. H.R.22 has passed both the House and the Senate. It is expected to pass and be signed into law, adding new section 7345 to the tax code. The title of the section is “Revocation or Denial of Passport in Case of Certain Tax Delinquencies.”
The idea goes back to 2012, when the Government Accountability Office reported on the potential for using the issuance of passports to collect taxes. Sen. Harry Reid (D-Nev.) got on board, and then Sen. Orrin Hatch wrote a Memo to Reporters and Editors. The idea has grown in popularity since then. The State Department could revoke, deny or limit passports for anyone the IRS certifies as having a seriously delinquent tax debt in an amount in excess of $50,000.
Assuming that it passes, in January of 2016, the State Department will start blocking Americans with ‘seriously delinquent’ tax debts. Administrative details about how all this will work are scant. But in all likelihood, it will mean no new passport and no renewal. It could even mean the State Department will rescind existing passports of people who fall into that category.
The list of affected taxpayers will be compiled by the IRS. The IRS will use a threshold of $50,000 of unpaid federal taxes. But this $50,000 figure includes penalties and interest. And as everyone knows, interest and penalties can add up fast. Notably, if you are contesting a proposed tax bill administratively with the IRS or in court, that should not count. That is not yet a tax debt.
There is also an administrative exception, allowing the State Department to issue a passport in an emergency or for humanitarian reasons. But how that will work isn’t clear, nor is the amount of time it will take to get special dispensation. You would still be able to travel if your tax debt is being paid in a timely manner, as under a signed installment agreement.