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State Department Will Be Allowed to Disclose Return Information to Contractors (NPRM REG-129260-16) – Tax & Accounting Blog

The IRS has proposed regulations authorizing the State Department to disclose return information to contractors in its passport unit. Disclosing return information to these contractors furthers a tax administration purpose.


Code Sec. 7345 requires the IRS to notify the State Department when individuals have seriously delinquent tax debt. The IRS can certify a tax debt as seriously delinquent when:

(1) an individual’s unpaid, legally enforceable federal tax liability greater than $50,000; and

(2) the IRS has filed a lien or levy notice for which the taxpayer’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 an individual’s seriously delinquent tax debt. The State Department may also revoke an individual’s previously issued passport.

Disclose Return Information

The proposed rules add the State Department to the list of agencies in Reg. §301.6103(n)-1(a)(1) whose officers and employees may disclose return information to contractors providing services connected to the revocation or denial of passports.

Comments Requested

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

Other References:

Code Sec. 6103

CCH Reference – 2018FED ¶36,891B

Tax Research Consultant

CCH Reference – TRC PENALTY: 3,338
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Author: CCHTaxGroup

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