IRC Section 7345
The United States Court of Appeals for the Fifth Circuit in James Franklin v. United States et al., Case No. 21-11104, handed down an opinion on September 15, 2022 in which it affirmed the United States District Court for the Northern District of Texas as it relates to revocation of the taxpayer’s passport for seriously delinquent taxes. Plaintiff, James Franklin was found by the IRS to have not filed accurate tax returns and had not reported a foreign trust for which he was a beneficial owner. Penalties were assessed against the taxpayer and enforcement action in the form of filing a federal tax lien, levying Social Security benefits and notifying the Department of State that the taxpayer was seriously delinquent ensued. The taxpayer ultimately sued the government over these issues and argued that the passport revocation scheme of the statute violated his rights under the Fifth Amendment because it affected his fundamental right to travel internationally. This Court reviewed several Supreme Court rulings and provided the following guidance: the right to international travel can be regulated within the bounds of due process. The Court analyzed the passport revocation statute’s goals, protections and objectives…ultimately deeming the statute to be constitutional. This decision is at least the second decision of a Court of Appeals on this topic in the last year. In Jeffrey T. Maehr v. United States Department of State, Case No. 20-1124, handed down on July 20, 2021, the United States Court of Appeals for the Tenth Circuit ruled the statute to be constitutional also.