International Taxpayers Need – But Can’t Have an IRS Online Account

An IRS online account is a safe and easy way for individual taxpayers to view specific details about their federal tax account.

The American Abroad REALLY Needs an Online Tax Account

How the US taxpayer living overseas would appreciate having such an online account! Time zone differences, long distance telephone charges when trying to reach the Internal Revenue Service (IRS), and the biggest problem – not receiving IRS paper correspondence advising of issues, tax deficiencies and the like are serious complications that plague the US taxpayer abroad.

Often the IRS has an outdated mailing address for the American taxpayer overseas who may frequently move from country to country with employment.  One item on everyone’s moving checklist should be properly notifying the IRS  of a change of address.  Terrible things can happen if this is not done and Americans abroad who rely on foreign mail carriers that are sometimes unreliable will have special concerns.

Not Getting IRS Letters at Foreign Address?  Passport Denial or Revocation May be Next

A significant concern for a taxpayer residing abroad who does not receive IRS correspondence are the US passport denial/revocation rules contained in Internal Revenue Code Section 7345.  If the IRS assesses tax deficiencies and the taxpayer never receives actual notice of the payments due, this Code provision can cause serious problems.  Section 7345 applies if a taxpayer has a so called “seriously delinquent tax debt”,  and authorizes the IRS to certify this fact to the State Department, clearing the way for passport denial or revocation. Generally, a “seriously delinquent tax debt” is an individual’s unpaid, legally enforceable federal tax debt (including interest and penalties) that totals more than US$54,000 (this figure is adjusted yearly for inflation). The State Department generally will not issue or renew a passport after receiving this certification from the IRS.  Upon receiving certification, the State Department may also revoke the passport.  Full details about this topic at my earlier blog posts here and here.

IRS Online Account – Immediate Access to Tax Information

The online system offers a lot assistance and gives a taxpayer immediate access to critical tax information.  Unfortunately, but not surprisingly, overseas taxpayers cannot create an online account even though they are the ones who need such access the most.  The current IRS online account process requires taxpayers to register for an online account through a Secure Access portal. This is the agency’s two-factor authentication process that protects personal info. Secure Access is not available for taxpayers who have international addresses.   See IRS FAQs about online accounts. In today’s highly sophisticated technological world, why this is so, is just puzzling.

The Taxpayer First Act Report to Congress includes a commitment to better serve international taxpayers.  The IRS says it will be rolling out this online tool for the taxpayer abroad. Well, let’s see!

Benefits of Online Tax Account

If you are a stateside taxpayer, here is what a taxpayer can view:

• The payoff amount, which is updated for the current day.
• The balance for each tax year for which the taxpayer owes taxes.
• The taxpayer’s payment history.
• Key information from the most current tax return as originally filed.
• Payment plan details if the taxpayer has an IRS payment plan in place.
• Digital copies of select IRS notices.
• Economic Impact Payments, if any.
• The taxpayer’s address on file with the IRS.

After viewing the information, a taxpayer can:

• Select an electronic payment option.
• Set up an online payment agreement.
• Go directly to Get Transcript.

The online account has a new authorization feature.  This option allows taxpayers to control who can represent them before the IRS or view their tax records. They can also approve and electronically sign Power of Attorney and Tax Information Authorization requests from their tax professional.

Let’s hope the American abroad can soon have an IRS online account.

Posted September 2, 2021

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