[conspire] New laws in 2016, cont'd.

[Rick Moen]

There are many more 2016 Federal and state laws than I listed.
One significant Federal measure I considered mentioning but didn't,
having classed it as insufficiently personal, is the Fixing America’s
Surface Transportation Act (FAST act), freeing up a great deal of funds
for fixing and funding highways & related things (bridges, passenger
rail, etc.).

This being Congress, other things got tacked _onto_ the FAST Act, having
nothing to do with Federal aid for transportation.  One of them caught
my eye.

Most readers will read what follows, and think 'This has nothing to do 
with me.  I don't care about this because I don't have a passport, and
will certainly never owe $50k in Federal taxes.'  Hold that thought;
maybe you should care anyway.  Even though you won't.

And this _is_ personal for you.  But you probably won't see that, either.


Back in Cold War days, one big, clear moral difference between Warsaw
Pact countries and the West is that former tended to treat its citizens
like prisoners; the latter didn't.  The Berlin Wall and the minefields
between Czechoslovakia and Austria/Germany existed to keep Warsaw Pact
citizens from leaving.  If, like Lee Harvey Oswald, you decided you
suddenly wanted to live in Russia rather than here, our attitude was 
'Bye, have a great time.'

Ability to pick up and _leave_ is always one of the last defences of
freedom, and the USA was blessed by people coming here to leave places 
that drove them away.

I was troubled recently when I heard that our Feds were now asserting
their right to require permission and valid US passports from not only
US citizens and others when coming home but also for them _leaving_.  I
thought it a settled moral principle that anyone who honestly insists on
leaving the USA and isn't, say, and escaped convict should have the gate
opened and told 'Bon voyage', documentation or no, and no permission is
required.

This bad feeling now worsens with just-enacted FAST Act's section 32101:

   SEC. 32101. REVOCATION OR DENIAL OF PASSPORT IN CASE OF CERTAIN UNPAID TAXES.

  (a) IN GENERAL. —Subchapter D of chapter 75 of the Internal Revenue Code
  of 1986 is amended by adding at the end the following new section:

    ‘‘SEC. 7345. REVOCATION OR DENIAL OF PASSPORT IN CASE OF CERTAIN TAX
    DELINQUENCIES.

     ‘‘(a) IN GENERAL. —If the Secretary receives certification by the
     Commissioner of Internal Revenue that an individual has a seriously
     delinquent tax debt, the Secretary shall transmit such certification to
     the Secretary of State for action with respect to denial, revocation, or
    limitation of a passport pursuant to section 32101 of the FAST Act.

    ‘‘(b) SERIOUSLY DELINQUENT TAX DEBT.—
 
   ‘‘(1) IN GENERAL. —For purposes of this section, the term
    ‘seriously delinquent tax debt’ means an unpaid, legally enforceable
    Federal tax liability of an individual—

      ‘‘(A) which has been assessed,

      ‘‘(B) which is greater than $50,000, and 

      ‘‘(C) with respect to which—

         ‘‘(i) a notice of lien has been filed pursuant to section 6323 and 
         the administrative rights under section 6320 with respect to such 
         filing have been exhausted or have lapsed, or

        ‘‘(ii) a levy is made pursuant to section 6331. 

   ‘‘(2) EXCEPTIONS. —Such term shall not include—

      ‘‘(A) a debt that is being paid in a timely manner pursuant to an
      agreement to which the individual is party under section 6159 or 7122,
      and

      ‘‘(B) a debt with respect to which collection is suspended with
      respect to the individual—

         ‘‘(i) because a due process hearing under section 6330 is 
         requested or pending, or

         ‘‘(ii) because an election under subsection (b) or (c) of section 
         6015 is made or relief under subsection (f) of such section is 
         requested.
[...]
Further provisions at
https://www.gpo.gov/fdsys/pkg/BILLS-114hr22enr/pdf/BILLS-114hr22enr.pdf


Some points:  

1.  This 'seriously delinquent tax debt' includes penalties and
interest, which can add up explosively even from a small tax amount.

2.  This can _and does_ happen to people who don't owe the taxes at all.
IRS can and does make massive errors and overassessments, out of the
blue, without notice -- and are considered 'tax debt' for purposes of 
section 32101 the moment IRS _claims_ they exist, long before you can 
challenge them and even before you've even _heard_ the claim against
you.

3.  For some tax bills, another provision of the Act now _requires_ (not
just permits, requires) use of private debt collectors acting on IRS's
behalf.  These debt collection freelancers might not even bother to give
you proper notice of the alleged debt, let alone have the facts right.

4.  Depending on your state/territory and whether your state/territory
has attempted to resist some requirements of the Federal Real ID statute
for good and reasonable privacy reasons (Alaska, California, Illinois,
Missouri, New Jersey, New Mexico, South Carolina, and Washington. Puerto
Rico, Guam, and the US Virgin), you may soon find that your state ID is
regarded as no longer valid as ID to enter a Federal facility, or enter
a military base, or _board a commercial airplane_.  At which point,
you'd need to present a passport -- unless, oops, IRS acted to ask State
Depeartment revoke your US passport, and maybe you didn't even know it.

http://arstechnica.com/tech-policy/2015/12/tsa-may-soon-stop-accepting-drivers-licenses-from-nine-states/


This situation even has me taking seriously a Fox Business News
reporter:

http://www.foxbusiness.com/economy-policy/2016/01/05/irs-gets-new-powers-to-revoke-passports/

  Yes, people should pay what they owe, especially if they want to
  leave the country.  But given the fact that the IRS collection unit has
  at times not been so state of the art, given the mistakes the IRS has
  already made in wrongfully emptying bank accounts and seizing assets,
  does anyone really think it’s okay for unelected bureaucrats to seize
  passports, blocking a basic freedom, that is freedom of movement?           

Yes, quite.

  Already, the IRS is seizing bank accounts of small businesses without
  warning, much less a warrant. That happened in August 2013 to Carole
  Hinders, owner of a Mexican restaurant in Arnolds Park in northwest
  Iowa. Hinders said the IRS seized about $33,000 from her checking
  account. Even though she was never accused of committing a crime, the
  IRS was suspicious because she made frequent small deposits. The IRS can
  seize accounts even though no charges have been filed, much less
  convictions won.

  As with the Hinders’s case, the problem with the new passport revocation
  law is that the IRS can simply cancel your passport merely by alleging
  you owe money to the federal government. It doesn’t have to get a
  judge’s okay or even a court review to do so, and in most cases, a
  passport will be rescinded simply if a lien has been filed. It also
  doesn’t give taxpayers the chance to fight the IRS’s decision in court
  before their passports are yanked, because the IRS operates on a “guilty
  until proven innocent” mode.

Maybe you went down to Baja California for a week's vacation.  
You go to board the flight home, and you hear 'Sorry, this 
US passport has been revoked and we're going to have to confiscate it.'
Suddenly, you're effectively stateless?  (I read that such people will
be allowed to return home, but then you're in the nation-as-prison.)


This has a larger context that is driving it, and that is IRS's
accelerating attempt over the last decade to collect US tax from US
persons abroad -- and find assets.

  “In our current age, it’s not that uncommon or difficult to find
  yourself owing the IRS fines of more than [$50,000], perhaps, for
  example, for not filing forms you didn’t know you needed to file. The
  minimum fine for not filing your FBAR [Foreign Bank and Financial
  Accounts report] is [$10,000]. However, if the IRS decides that you
  willfully failed to file your FBAR, the penalty jumps to [$100,000] or
  [50 percent] of the account values, whichever is greater,” 
  [_Offshore Living Letter_ author Leif] Simon wrote.

  [CPA and ProVision Wealth Strategies CEO Tom] Wheelwright shared a
  similar view. He told the _[Arizona] Republic_ that incurring such 
  a debt would not take much if a person lost a job or wound up with 
  big medical bills.  Furthermore, contacting the IRS is proving 
  increasingly difficult, with the agency answering less than half 
  of telephone calls from taxpayers.


So, is it becoming time to shop around for a cheap dual-citizenship
option?

My former boss Jourdan Clish said his father made a point of having a 
cache of valid additional passports available for the family, just in 
case it was necessary to leave in a hurry and the USA had suddenly 
become hostile.  Bearing in mind his dad's European Jewish refugee
background and then-recent history, this was extremely sensible.

Generally, countries offering second citizenships (understandably) 
attach significant strings such as residency, investment, or both.  
Saint Kitts and Nevis wants a US $400k investment and a registration fee
of $50,000, for example: http://ciu.gov.kn/ .  With an eye for a good
cash opportunity, Antigua and Barbuda has followed suit with the
commendably honestly named 'Citizenship by Investment Programme',
$400k cold cash sans $50k bribe^W registration feel.  Grenada requires
just $250k.  And Commonwealth of Dominica requires a non-refundable
investment of $100,000, in addition to $1,800 in fees.
https://en.wikipedia.org/wiki/Economic_citizenship 

OTOH, good old Paraguay charges only nominal paperwork fees -- but
requires three years of residence and working in a desirable profession.
(Also, you lose it if you live outside Paraguay more than three years in
a row.)  

Malta and Cyrus offer relatively cheap (by millionaire standards) EU
citizenship, and Portugal and Greece aren't far behind.  As usual, the
very rich have extra options the rest of us can't consider.  (Some
second citizenships are a lot more useful than others.  With a
hypothetical Paraguay passport, you'd end up needing an expensive and
not-necessarily-available visa for most other destinations.)

But I'll bet that Congress isn't bothered by curtailing freedom of
movement in the first place, because they don't believe it's a right.
Nor, I'll bet, do you.  Which is a pity.

But some day, you might miss it.