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Passports: The IRS Continues to Tighten the Screws


Over the past year, I’ve had more and more clients tell me that when they enter the United States with a Canadian passport, they are being hassled by US border guards. A Canadian passport generally lists an individual’s place of birth, so the border officials can identify US citizenship this way. Some people have been told that in the short future, they will not be able to enter the US this way, so they will need to get US passports.

A concern is that these individuals may not have been filing US tax returns. This is about to be a bigger problem..

Since 1986, any person who applied for a US passport or "green card" (allowing him or her to permanently live and work in the United States) has been required to include with the application certain information. Regulations were proposed in 1992, but not finalized.

The IRS has recently issued new proposed regulations to replace these. The applicant will have to provide:

  • Name (and previous name, if there was one);
  • Address;
  • US tax identification number – usually a Social Security Number;
  • Foreign (non-US) country in which the individual was residing;
  • Date of birth;

Applicants who fail to provide the above information will face a $500 penalty. The US Citizen Immigration Service is then expected to pass this information to the IRS. An applicant who has not filed returns can expect communication from the IRS.

If you haven’t been filing US returns, this is yet one more reason to become compliant.

At this point the proposed regulations have not been enacted. I’ll keep you posted on further developments as soon as they’re made available.

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