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Odysseus
05-02-2012, 09:07 AM
No Taxes, No Travel: Why the IRS Wants the Right to Seize Your PassportBy Jacoba Urist
Does the Tax Man have the right to prevent us from traveling, even without a formal charge of evasion or another crime? Maybe we're about to find out. http://cdn.theatlantic.com/static/mt/assets/business/615%20irs%20tsa%20passport%20airport.jpg Reuters
You're standing at the airport. The ticket agent clacks away on the keyboard. She looks up. "I'm sorry," she says. "We can't let you board the plane today." Why? "It's the IRS. They say you haven't paid all of your taxes."

It sounds like the opening scene of a straight-to-DVD Washington thriller. It's actually a few votes from becoming a reality. A new bill, quietly making its way through Congress, allows the federal government to stop people with unpaid taxes from leaving the country-- even if they haven't been charged with tax evasion or any other formal crime.

It all started last fall, when Senator Barbara Boxer introduced the "Moving Ahead for Progress in the 21st Century Act" (or "MAP-21" as it's now called), to reauthorize funds for federal highway and transportation programs. While that doesn't sound like anything having to do with your taxes, the bill includes a little-noticed section that allows the State Department to "deny, revoke or limit" passport rights for any taxpayers with "serious delinquencies."

Here's how it would work. If someone owed more than $50,000 in back taxes, the IRS would be able to send their name over to the passport office for suspension, provided that the IRS already either filed a public lien or a assessed a levy for the outstanding balance. The bill does provide a few exceptions though. For example, if a person has set up a payment plan (that they're paying in a timely manner), is legitimately disputing the debt, or has an emergency situation or humanitarian reason and must travel internationally, they may be able to leave for a limited time despite their unpaid taxes.

IS THAT LEGAL?


Timothy Meyer, a constitutional law professor at the University of Georgia, who's also served as a State Department lawyer, believes that, for all its creepiness, the rule is probably legal. He concludes that if the passport provisions of MAP 21 became law and were challenged, chances are, the courts would find that they satisfy Due Process concerns. Even though there's no judicial hearing before your travel rights are restricted, the bill does protect a passport holder who's challenging the alleged tax debt. And according to Professor Meyer, that's probably enough here.

"Courts have upheld statutes calling for the revocation and denial of passports to those in arrears of child support payments," he explains. "In part, because the child support payments can be contested."
As Meyer points out, MAP 21 certainly isn't the first law to limit a person's right to travel because they owe somebody money. The State Department screens passport applications every day for people who owe child support of more than $2500--a lot less than the $50,000 proposed here. And the tax system is routinely used to get Americans to make good on their outstanding liabilities. In fact, over the next few weeks, some folks won't be getting the refund check they're expecting if, for instance, they've defaulted on their student loans, owe state or local taxes, or haven't ponied up for the child support they owe. Most people don't realize it, but the IRS is in contact with federal and state agencies throughout the year, making sure you've paid your debts before they send you a chunk of change back in the mail.

Kramer Levin partner and member of the IRS Taxpayer Advocacy Panel, Russell Pinilis, is sympathetic to both sides of the issue, but thinks that overall, MAP 21 reflects the frustrating position the government faces when someone just won't pay their taxes.

"The problem," he says, "is that the government isn't a normal creditor. They're not lending you money. They can't put you in jail, and they have to be able to do something."

There's no question that the IRS has trouble collecting the revenue they're supposed to, and that those of us who pay our taxes are hurt by the people who don't. The IRS has even developed the concept of the "tax gap" as a way to gauge people's compliance (or lack there of) with their federal tax obligation. According to the most recently released data, Americans owe $450 billion more in federal taxes than they actually paid, an increase in $105 billion (http://www.irs.ustreas.gov/pub/newsroom/overviewtaxgap_2006.pdf) from the last time the IRS looked at the issue.

Professor Daniel Shaviro, a tax policy expert at New York University School of Law, recognizes that there is a legitimate policy goal at play in the proposed travel restrictions: making sure someone stays in the country and really pays the taxes they owe. After all, he says, someone who owes a huge amount in taxes might present a flight risk. He does, however, worry about the possibility that the passport rules could be misused, say, to harass specific individuals whom government officials dislike.


IRS + TSA = UH OH


But is all of this a little extreme? The IRS places tax liens on assets all the time, putting other creditors on notice that you have an outstanding debt with the US government. And would someone really flee the country--leaving their home and their family behind--over a $55,000 tax bill? At this point, there's no real data either way, but Senator Boxer continues to push House Republicans to pass MAP 21 with the travel ban in place.

"Thousands of businesses are at stake," she said (http://epw.senate.gov/public/index.cfm?FuseAction=PressRoom.PressReleases&Conte ntRecord_id=601761ed-802a-23ad-42cd-0fbb4083cc65&Designation=Majority) in a statement. "There are many people on both sides of the aisle in the Senate who want to get our bill passed into law, and I'm going to do everything I can to keep the pressure on the Republican House to do just that."

For now, at least, MAP 21 remains pending legislation. But, in the future, when traveling abroad, you may need to worry about more than just your shots and those baggage fees -- you may need permission from the IRS.

This article available online at:
http://www.theatlantic.com/business/archive/2012/04/no-taxes-no-travel-why-the-irs-wants-the-right-to-seize-your-passport/255940/


Copyright 2012 by The Atlantic Monthly Group. All Rights Reserved.

noonwitch
05-02-2012, 11:06 AM
The IRS should not have the authority to yank a citizen's passport without a hearing. Only the courts should have the authority to take someone's passport.

The IRS should not be given a loophole in order to avoid judicial process. It would be the same thing as if CPS could take your kids without asking the court, first. An executive branch bureaucracy should never have that type of unchecked power, whether at a federal or state level.

Molon Labe
05-02-2012, 11:38 AM
The IRS should not have the authority to yank a citizen's passport without a hearing. Only the courts should have the authority to take someone's passport.

What country do you think you live in....the US? lol

Odysseus
05-02-2012, 12:57 PM
One of the reasons that I posted this was this little gem:


Kramer Levin partner and member of the IRS Taxpayer Advocacy Panel, Russell Pinilis, is sympathetic to both sides of the issue, but thinks that overall, MAP 21 reflects the frustrating position the government faces when someone just won't pay their taxes.

"The problem," he says, "is that the government isn't a normal creditor. They're not lending you money. They can't put you in jail, and they have to be able to do something."

I was under the impression that, unlike a normal creditor, who can only initiate a civil complaint for failure to pay a debt (unless fraud is involved), the IRS actually could sentence a tax evader to jail. No? Then what about these guys?



Famous People Have Tax Problems, TooSeveral Celebrities Have Had Run-Ins With Taxman




Tax Day is near, and what better way to reflect upon it than looking back at all the famous people charged with tax-related offenses.



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Willie Nelson
Nicknamed the "Red-headed Stranger," country singer and actor Willie Nelson became friend with the IRS in 1993 when he settled a $16 million delinquent tax bill. The tax evasion nightmare began in 1990 for Nelson, which cost him nearly all of his personal belongings (which fans bought at auctions and gave back to him). Nelson also released the album "The IRS Tapes: Who Will Buy My Memories," and its profits were directed to the IRS.


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Dr. Martin Luther King, Jr.
In February of 1960, civil rights leader Dr. Martin Luther King Jr. was arrested on charges of tax evasion for allegedly falsifying his income tax returns. He was acquitted in May with the support of presidential candidate John F. Kennedy.


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Don King
Boxing promoter Don King was charged with tax evasion in 1991, but a mistrial was declared after one of the jurors admitted to reading an article about possible jail time for such an offense. He was later charged with nine counts of insurance fraud, of which he was acquitted.


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Richard Pryor
Comedic Actor Richard Pryor tumultuous career included and arrest for tax evasion in June 1974. He served ten days in the Los Angeles County Jail for the offense, and teamed with comedian Flip Wilson to throw a benefit concert for the jail's 300 inmates soon after.


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Studio 54
Steve Rubell and Ian Schrager, co-owners of Studio 54, New York's most popular club in the 1970's, were found guilty of tax evasion in 1979. They served over a year in federal prison after admitting that they kept thousand of dollars in club revenue hidden. Mike Myers played Rubell in the 1998 movie "54."


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Luciano Pavoratti
World famous Tenor Luciano Pavoratti was convicted of tax evasion in 1999, and ordered to pay $11 million to the Italian Courts. He was again accused of tax evasion by his hometown of Modena in 2001. The opera star was acquitted of the charges and spared what would have been an $18 million fine.


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Al Capone
Failure to pay four years worth of taxes left gangster Al Capone with multiple felony charges. In 1930, Capone was sentenced to 11 years in prison and an $80,000 bill. The conviction was seen as a means to charge Capone with crime since he managed to escape other charges.


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Chuck Berry
Singer-songwriter Chuck Berry was charged with tax evasion in 1979. He pled guilty and was ordered to perform 1,000 hours worth of benefit shows after serving four months in prison.


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Alan Freed
Disc jockey Alan Freed, who coined the phrase "rock & roll," faced charges of tax evasion and commercial bribery in 1962 after accepting money from musicians in exchange for airtime. His suspended sentence of six months and a $300 fine would mark the end of his career.


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Sophia Loren
After being charged with tax evasion in 1982, actress Sophia Loren spent 18 days in an Italian prison. Apparently, her husband's bets at sporting events weren't very profitable; he was also jailed.


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Leona Helmsley
Not wanting to be one of "the little people" who pay taxes, billionaire Leona Helsmley and her husband withheld millions in tax revenue. She was sentenced to almost two years in prison along with a $7 million fee in 1990. Rumor indicates that she had money smuggled into prison for the purpose of paying an inmate to be her servant.


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James Traficant
U.S. Rep. James Traficant was convicted April 11 for, among other acts, racketeering and tax evasion. and is facing up to 63 years in prison. Upon release of such a sentence, Traficant would be 124 years old.


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Spiro T. Agnew
Vice President from 1969-1973, Spiro T. Agnew pled no contest to one count of tax evasion in October of 1973. He received three years probation and a $10,000 fine to go along with his decision to resign.





Read more: http://www.kcra.com/money/1394441/detail.html#ixzz1tjT2yqtk

Gina
05-02-2012, 01:18 PM
Wesley Snipes!