According to data from the U.S. Department of State, we’re truly living in a global era with over 48% of Americans currently holding a valid U.S. Passport for international travel. Back in 1990, only about 5% of Americans enjoyed this privilege.

Having a passport allows you to travel the globe, but it isn’t something that just anyone is eligible to hold. There are circumstances that could lead to a revocation of your right to own a passport, including getting behind on your taxes.

If you receive a CP71C notice, then that means you’ve reached the tax delinquency threshold that’s resulted in having your passport threatened. It’s important to address the notice and your tax situation if you plan on utilizing your passport after getting this letter. Learn how to handle this notice and navigate your back taxes below.

What is IRS Notice CP71C?

CP71C is a type of IRS collection notice. This notice is an annual reminder notice to inform you of your current balance owed, penalties, and interest. This notice is sent even if you have worked with the IRS in the past to address your issue with a payment plan or currently not collectible status. Many times, no action is needed on your part. If you receive this notice in the mail, then it means that you owe the tax agency a tax, penalty, and interest. It also means that your tax delinquency has progressed to the point where your United States Passport is at risk.

If you already have a valid passport, then it will be revoked. If you don’t have a passport, you won’t be able to get one. The FAST Act (Fixing America’s Surface Transportation) gives the State Department the right to deny renewals and prevent the new issuance of a passport for taxpayers who are delinquent on their taxes.

Tax Debt Levels for Passport Revocation

The IRS says that it will tell the State Department to take your passport if you have “seriously delinquent” tax debt. The definition of seriously delinquent is pegged to inflation, and it increases every year. When the law initially took effect, the threshold was $50,000, but as of 2024, it’s $62,000 which includes tax, interest, and penalties. 

Steps to Take After Receiving a CP71c

Did you just receive IRS notice CP71? If so, then it’s important to take action, or at the very least, you need to make an informed decision on how to handle your tax situation moving forward. Getting in touch with the IRS is not always your best option. 

Depending on your circumstances, you may decide to contact a tax professional, review your finances, arrange to make a payment, or even allow the statute of limitations clock to run out on your debt. Below, we’ll go over exactly what steps to take if you get this notice.

Read Through the Notice Carefully

First, read through the entire notice carefully. Review all the information you find in the letter, and make sure you have a general understanding of the contents of the letter. You’ll want to understand exactly how much you owe, what the IRS has already charged you in penalties and fees, and if any interest has accumulated on your account. 

On top of these details, you will want to understand what the notice is asking you to do, how you can contact the IRS if you need to, and any other options detailed in the letter. Having a solid understanding of everything in the letter will help you make an informed decision on how to navigate the situation.

Check Everything for Accuracy

As you go through your letter, verify all the information you come across. If your personal details, financial information, penalties, or tax numbers seem off in any way, then it could be possible that the letter was sent in error. If you believe the IRS has incorrect information about your taxes on file or the balance seems inflated, then it might be necessary to get in touch with an IRS agent who can help you determine what went wrong. 

Before you contact the IRS, consider whether it’s best to hire a tax expert. The right tax professional will be able to advise you on how to handle the situation or even field the call with your IRS agent for you.

Consider Your Ability to Pay

If everything in the notice seems accurate, then your next step should be to consider your ability to pay. Consider your entire financial picture as well as the pros and cons of arranging to resolve your debt. In general, the IRS won’t ask you to pay above your ability to do so. They’ll work with you if you can’t pay off your entire balance in one lump sum. 

That said, go over your entire financial situation. Consider your income, expenses, and the maximum amount of money you’d be able to allot toward paying off your tax debt. Once you have a rough idea of how much you can reasonably pay, you’ll be in a better position to negotiate with the IRS.

Learn About Your Options

Next, consider your options for settling your debt. In general, the best way to take care of your situation for good is to simply make one giant payment that incorporates all of your back debt, interest, and penalties. If you’re able to do this, then your situation will be solved. 

If you can’t afford to pay everything at once, then you can arrange a payment plan that allows you to pay your balance over a long period of time. You’ll need to make consistent, regular payments to the IRS.

Depending on your specific situation, there might be other options available to you. For instance, if paying would cause a financial hardship for you and your family, then you may be able to file for currently non-collectible status. If you can pay part of the balance, you may be able to settle for less than owed with an offer in compromise.

If you experienced a natural disaster, then it might be possible to get some relief through penalty abatement. You can also get penalty abatement in cases where you incurred penalties for the first time in several years.

Get in Touch with a Tax Professional

Once you’ve taken all these steps, you should have a general idea of how to move forward with your tax situation. If you’re still unsure of what to do or you simply want to get solid advice from an experienced tax expert, then consider reaching out to a tax professional. The right representative will be able to fully inform you regarding your options, rights, and best strategy.

What Will Happen if You Don’t Respond to an IRS CP71C Notice

If the IRS does not receive a response from you after sending you a CP71C notice, then the agency will continue to send you annual reminder notices about your tax situation until the statute of limitations on your debt runs its course. 

On top of sending you these notices, your passport rights will be revoked. Depending on your situation, you might also face increasingly significant collection efforts. The IRS may issue a federal tax lien against all your property and assets. You could also face wage garnishment or other civil penalties.

FAQs: IRS CP71 Notice

Do you have more questions about your recent IRS CP71C notice? Consulting directly with a tax professional can provide more specific guidance based on your unique circumstances. That said, we will go over some general answers to some of the most frequently asked questions about IRS CP71 notices below.

Can You Get Your Passport Revocation Reversed?

Yes. You can reverse your passport revocation by getting back in good standing with the IRS. Paying off your entire delinquent tax debt is the easiest and fastest way to get your passport back, but it isn’t your only option. 

You’ll also be able to re-certify your passport if you agree to an installment agreement or offer in compromise deal with the IRS. Your passport revocation will also expire if your tax debt statute of limitations runs out. In rare cases, you may be able to prove that your tax delinquency was erroneous or an error and get your passport revocation reversed.

Can You Have Penalties Removed From Your IRS Balance?

It depends on your specific circumstances. The IRS offers penalty abatement in some circumstances, but not everyone is eligible for relief. Speak to a tax professional to learn more about whether penalty abatement is an option in your situation.

What Will Happen if the IRS Revokes My Passport While I’m Out of the Country?

If you are abroad when your passport gets revoked, then you can still use your passport to return to the U.S. It’s advised that you travel back as soon as you can to avoid any further issues.

If you have plans to travel using your passport in the next 45 days, then it might be possible for the IRS to expedite your reversal of certification request, but you’ll need to inform the agency about your intent to travel and provide proof before they take action.

What Happens if I Miss a Payment After Creating a Plan with the IRS?

If you miss a payment on an IRS installment agreement, then you’ll be back on the wrong side of the IRS again. Your installment agreement is legally binding, and if you go into default, the agency will typically send you Notice CP523. 

Then, the IRS is once again authorized to initiate any collection efforts that were halted during your payment arrangement. Your entire deal could be canceled, too, so you need to do your best to always make your payments on time when possible.

Do I Need to Contact a Tax Professional?

You should contact a tax professional if you want personalized legal counsel on how to navigate your challenging tax matters. A tax expert can help you if you recently had your passport revoked. You might want to call a lawyer if you receive Letter 6152, which is your 30-day warning before your passport is taken away.

Get in Touch With Our Tax Resolution Team Now

Here at Seattle Legal Services PLLC, our team of tax resolution professionals knows exactly how jarring it can be to receive a CP71C letter, especially if you already have plans to utilize your passport for business or recreational purposes.

The good news is that no tax situation is ever too far gone to be resolved. Even if you owe the IRS a tax burden that you know feels insurmountable, don’t let that stop you from seeking resolution. In most cases, the IRS will work with you based on your true financial circumstances. The IRS will never ask you to pay money that you genuinely can’t pay without getting into an economic hardship situation.

Of course, it might be best to consider speaking with a tax professional before reaching out to the IRS. A tax professional can ensure that your interests and rights are protected throughout the negotiation process with the IRS. They’ll help you minimize your penalties and overall tax liability, and the right tax professional will provide you with solid advice that will keep you on the right side of the IRS in the future.

Are you ready to get started? Schedule a call with our office now to learn more about how we can help.