Nicholas Frey

Owing a substantial amount of money to the IRS can create more than just collection problems. In certain situations, the federal government may deny, revoke, or limit a taxpayer’s United States passport due to unpaid federal tax debt. For taxpayers who travel internationally for work, family, or personal reasons, this can create significant hardship and disruption.

At Frey Law Firm, we help taxpayers understand their rights, resolve IRS collection issues, and take action before passport restrictions become a serious problem.

Under Internal Revenue Code Section 7345, the IRS may certify a taxpayer as having “seriously delinquent tax debt” to the United States Department of State. Once certified, the State Department may:

Deny a new passport application
Deny passport renewal
Revoke an existing passport
Limit a passport to return travel only to the United States

This law was enacted as part of the Fixing America’s Surface Transportation (FAST) Act and gives the IRS another powerful collection tool against taxpayers with large unpaid balances.

The threshold amount changes periodically due to inflation. Generally, a taxpayer may face certification if:

The unpaid federal tax debt exceeds approximately $65,000 (including penalties and interest), and
The IRS has filed a Notice of Federal Tax Lien and the taxpayer failed to timely request a hearing, or
The IRS has issued a levy or levy notice

The balance includes:
Individual income taxes
Business trust fund liabilities in some cases
Penalties and accrued interest

The amount can grow quickly due to failure-to-file penalties, failure-to-pay penalties, and statutory interest.

Once the IRS certifies the debt to the State Department, the taxpayer typically receives IRS Notice CP508C informing them of the certification.
After certification:

Passport applications may be denied
Renewals may be delayed or refused
Existing passports may become subject to revocation

In many cases, the State Department allows a short window for the taxpayer to resolve the issue before taking final action.

Not all unpaid tax debts qualify for passport certification. The IRS generally will not certify taxpayers who are:

In an approved installment agreement
In an accepted Offer in Compromise
In Currently Not Collectible (CNC) status
Subject to an active Collection Due Process hearing
Protected by bankruptcy proceedings
Victims of identity theft related to the tax debt
Located in a federally declared disaster area in certain situations

This is why proactive representation is extremely important. Entering into a valid resolution before certification may prevent passport problems entirely.

The passport can be reinstated. Once the IRS reverses the certification, it notifies the State Department that the taxpayer is no longer considered seriously delinquent.

The IRS may reverse certification if:

The tax debt is paid in full
The balance drops below the statutory threshold
The taxpayer enters into a qualifying resolution agreement
The certification was issued in error

However, delays can occur between IRS processing and State Department updates, especially if international travel is imminent.

The IRS generally notifies the State Department within 30 days after resolving the issue. However, processing times can vary.

For taxpayers with urgent travel needs, immediate action is critical. Waiting until a passport renewal is denied can severely limit available options.
If you receive Notice CP508C or believe your passport may be at risk:

Obtain IRS account transcripts
Determine the exact balance owed
Verify whether certification was proper
Evaluate collection alternatives
Request appropriate relief quickly
Ignoring the problem can lead to escalating IRS enforcement actions beyond passport restrictions, including levies and liens.

At Frey Law Firm, we assist taxpayers with:

IRS installment agreements
Offer in Compromise negotiations
Currently Not Collectible requests
Appeals and Collection Due Process hearings
Passport certification reversals
IRS transcript analysis
Penalty abatement requests
Emergency IRS collection matters

Every IRS case is different, and timing often matters significantly when passport restrictions are involved.

Passport denial or revocation due to federal tax debt can be one of the most disruptive IRS collection actions a taxpayer faces. Fortunately, taxpayers often have options available before and after certification occurs.

The earlier the issue is addressed, the more resolution options may be available. Taxpayers facing substantial IRS balances should act quickly to protect both their financial interests and their ability to travel internationally.