The IRS has proposed authorizing the State Department to disclose return information to contractors in its passport unit. According to the IRS, disclosing return information to these contractors furthers a tax administration purpose.
Code Sec. 7345 requires the IRS to notify the State Department when an individual has a seriously delinquent tax debt. The IRS can certify a tax debt as seriously delinquent when:
- an individual’s unpaid, legally enforceable federal tax liability greater than $50,000; and
- the IRS has filed a lien or levy notice and the individual’s Collection Due Process rights have been exhausted or lapsed.
Generally, the State Department must deny an individual’s request for a new or renewed passport after the IRS certifies the individual’s tax debt as seriously delinquent. In addition, the State Department may revoke a certified individual’s passport.
Disclose Return Information
The proposed rules add the State Department to the list of agencies whose officers and employees may disclose return information to contractors. The rules allow disclosure to contractors providing services connected to the revocation or denial of passports.
Written and electronic comments and a request for public hearing must be received by April 12, 2018. Submissions may be mailed to CC:PA:LPD:PR (REG-129260-16), Room 5207, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, D.C. 20044. Submissions may also be hand delivered Monday through Friday between the hours of 8:00 a.m. and 4:00 p.m. to CC:PA:LPD:PR (REG-129260-16), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue, NW, Washington, D.C. 20224. Alternatively, taxpayers may submit comments electronically via the Federal eRulemaking Portal at www.regulations.gov (IRS REG-129260-16).
Proposed Regulations, NPRM REG-129260-16