Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes • Hacker News Board

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#81

Post by chrismcb » Sat, Jul 07, 2018, 11:18 PM UTC

V-2 wrote: post #60

fyfy18 wrote: post #39

Earlier quoted context omitted.

This is exactly it - the airline is responsible for returning you home if you are denied entry to a country. My wife used to work as an air stewardess, and one of her longer flights was a 16 hour non-stop flight from Dubai to Brazil. This involved a 3 day layover, and on the inbound flight she saw some (rather tired) passengers who had been on the outbound flight. Apparently they were denied entry, however it was too…

Right, so that goes back to my original point - it's other countries not letting a passport-less person in. The airlines have no other choice but to accept the fact.

An airline denied my passport (had gone through the wash) I had just returned from Canada and had used the passport, in the same condition, in the country I was going to. But the airline didn't care. They said they could be fined $25000 for bringing a passenger without a valid passport plus they would have to return me.

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#82

Post by pembrook » Sat, Jul 07, 2018, 11:30 PM UTC

perl4ever wrote: post #64

BeetleB wrote: post #48

Earlier quoted context omitted.

A lot of the problem isn't that they owe taxes but that they have trouble filing correctly. You're required to file even if you owe no tax. The US has fairly high reporting requirements. Think of all the tax forms you've received in the US. W2. All the various 1099s. All the docs related to stocks, SPP, interest on mortgage, real estate transactions, etc. The IRS still needs all that paperwork even if you have these…

"This proves burdensome enough that a lot of expats pay thousands a year to tax firms" It's a matter of opinion, but I don't think it's an intolerable burden if your tax prep costs are <10% of your total tax bill.

Is H&R Block doing sponsored posts on HN now?

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#83

Post by pembrook » Sat, Jul 07, 2018, 11:34 PM UTC

macleginn wrote: post #50

pembrook wrote: post #32

Have a feeling this will end up extorting American expats and people who grew up abroad without ever living or working in the US (who are only US citizens because of their parents). When FATCA was passed, it flipped a switch that automatically made tens of thousands of people around the world who have never set foot in the US into criminals by default since they'd never filed US taxes (the US has the only global taxa…

> [T]he US has the only global taxation system in the world Not exactly, Eritrea is another case.

Sorry, you're correct. Eritrea is the only other case.

Except Eritrea doesn't have a stranglehold on the global banking system like the US so it's basically a non-issue for Eritreans.

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#84

Post by BeetleB » Sat, Jul 07, 2018, 11:35 PM UTC

perl4ever wrote: post #64

BeetleB wrote: post #48

Earlier quoted context omitted.

A lot of the problem isn't that they owe taxes but that they have trouble filing correctly. You're required to file even if you owe no tax. The US has fairly high reporting requirements. Think of all the tax forms you've received in the US. W2. All the various 1099s. All the docs related to stocks, SPP, interest on mortgage, real estate transactions, etc. The IRS still needs all that paperwork even if you have these…

"This proves burdensome enough that a lot of expats pay thousands a year to tax firms" It's a matter of opinion, but I don't think it's an intolerable burden if your tax prep costs are <10% of your total tax bill.

>It's a matter of opinion, but I don't think it's an intolerable burden if your tax prep costs are And I do. For most of the world, tax prep costs are negligible. I'm not sure how many countries have tax prep for individuals as a big business like it is in the US.

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#85

Post by BeetleB » Sat, Jul 07, 2018, 11:40 PM UTC

Godel_unicode wrote: post #75

BeetleB wrote: post #48

Earlier quoted context omitted.

A lot of the problem isn't that they owe taxes but that they have trouble filing correctly. You're required to file even if you owe no tax. The US has fairly high reporting requirements. Think of all the tax forms you've received in the US. W2. All the various 1099s. All the docs related to stocks, SPP, interest on mortgage, real estate transactions, etc. The IRS still needs all that paperwork even if you have these…

> You're required to file even if you owe no tax. That's true above the $10k limit, yes. > For those lower income folks it's cheaper to renounce than to keep paying these fees. I guess it's a good thing that's easy for them, then!

>I guess it's a good thing that's easy for them, then!

I fail to see how you drew that conclusion - it was not what I said.

If you consider paying $2K to avoid doing paperwork that gains you very little "easy", I would like to be your friend.

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#86

Post by TheCoelacanth » Sat, Jul 07, 2018, 11:51 PM UTC

mankash666 wrote: post #10

I've had 2 instances where the IRS erroneously concluded that I owe them large tax bills. It took a few months of back and forth paperwork and phone calls to resolve, and have the IRS note on paper that I owe them nothing. With this law, an erroneous IRS decision can limit passport issuance and international travel. Three letter agencies are probably salivating at the prospect of 'errors' in possible suspects. This j…

It seems like you would have to go far beyond that stage without settling the tax bill before you would be at risk of having a passport application denied.

> To be at risk of passport denial, a taxpayer must typically be subject to a lien, which advises creditors of a debt to the IRS, or a levy, which gives the IRS the authority to seize assets.

> Taxpayers typically aren’t subject to passport restrictions if they’re contesting an assessment administratively or in court, or if they have pending or current installment-payment agreements or offers-in-compromise with the IRS.

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#87

Post by TheCoelacanth » Sun, Jul 08, 2018, 12:04 AM UTC

ci5er wrote: post #16

freehunter wrote: post #11

Earlier quoted context omitted.

I'm not sure I see how. Seems like a great incentive, actually. Your passport is about to expire, but you're not going to get a new one unless you settle your debts. I doubt people with more than $50k in tax debt are the kind of people who can't come up with the money, they're just the people who don't want to.

If you live and work overseas, the IRS commonly miscalculates money owed. This can leave one stranded through no fault of their own and/or seriously interrupt a career. This law doesn't only sweep up tax evaders...

It's not like they immediately revoke your passport as soon as the IRS decides that you owe them money. You need to get a lien or levy against you. People who are contesting the debt either administratively or in court or who have a payment agreement with the IRS can still get a passport.

The State Department can also bypass the rule for emergencies or humanitarian reasons and will do so to allow someone to return to the US, so it is not possible to be stranded outside of the country because of this.

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#88

Post by ci5er » Sun, Jul 08, 2018, 12:14 AM UTC

TheCoelacanth wrote: post #87

ci5er wrote: post #16

Earlier quoted context omitted.

If you live and work overseas, the IRS commonly miscalculates money owed. This can leave one stranded through no fault of their own and/or seriously interrupt a career. This law doesn't only sweep up tax evaders...

It's not like they immediately revoke your passport as soon as the IRS decides that you owe them money. You need to get a lien or levy against you. People who are contesting the debt either administratively or in court or who have a payment agreement with the IRS can still get a passport. The State Department can also bypass the rule for emergencies or humanitarian reasons and will do so to allow someone to return to…

Re: Part I - Yes. Getting a payment agreement works. This is nicer when you aren't caught by surprise.

Re: Part II - "Home" for many is not the US. That's just citizenship. Trying to island hop across the South China seas without an "active" passport is problematic. Or if one were to return to the US to bury a parent, getting back to work can be problematic.

I'm not arguing that it can't be worked through. But it is a real time-consuming hassle, esp. when caught unawares because of bureaucratic snafu, that can be career limiting when caught on the wrong side of a dotted line...

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#89

Post by T-R » Sun, Jul 08, 2018, 12:19 AM UTC

pokemongoaway wrote: post #53

T-R wrote: post #42

Earlier quoted context omitted.

Which is doubly disgusting, since the US is one of the only countries that double-taxes its expats.

Exactly! And then spend barely any of that tax money on what real Americans want!

To the extent this comment can be construed as anything but content-less partisan dog-whistling, it's pretty off the mark here. Obnoxious as this particular measure is, it was passed as part of the funding for a, relatively speaking, bipartisan infrastructure bill focusing on highways and rail. It's hard to imagine what "real Americans", whoever that's meant to imply, would rather it be spent on.

Re: Thousands of Americans Will Be Denied a Passport Because of Unpaid Taxes

#90

Post by jsoc815 » Sun, Jul 08, 2018, 12:28 AM UTC

nradov wrote: post #61

duxup wrote: post #47

Earlier quoted context omitted.

I wonder how likely it is people would renounce their citizenship.... that US passport / citizenship is pretty powerful.

During the past few years under 10,000 US citizens have renounced their citizenship per year. So basically negligible as a percentage of the population.

While the numbers provided are not in the millions, it's important to understand that the oft-cited numbers are also (thought) to be incomplete. Here is one example.[1] But I see the claim fairly regularly.

Also, the discussions often focus on people who renounce their U.S. citizenship, but I rarely, if ever, see any on people who relinquish. And while the result with respect to U.S. citizenship may end up being the same for both processes, I understand that the treatment of the former citizen is often different based on the option selected.

Lastly, while the numbers may be small, we don't know the value of the wealth that they are taking with them. Could be little or a lot. And while yes, there are exit taxes, people with enough to lose will expend some energy to not do so.

[1] https://www.forbes.com/sites/robertwood/2017/06/12/more-amer...