Homeland Security may contact U.S. persons living abroad who owe back taxes.

• Author: Smith, Annette B.

The IRS has established procedures to facilitate tax collection from taxpayers who live outside the United States. If a taxpayer has an unpaid tax liability and is subject to a resulting Notice of Federal Tax Lien, the IRS may submit identifying taxpayer information to the Treasury Enforcement Communications System (TECS), a database maintained by the Department of Homeland Security (DHS). The database allows the DHS to identify taxpayers with unpaid tax assessments who are traveling to the United States for business, employment, or personal reasons (Internal Revenue Manual (IRM) [section]5.1.12.26). As a result, taxpayers traveling to the United States with unpaid tax assessments increasingly are being detained at the border.

A U.S. or non-U.S. person whom the IRS has been unable to contact may be unaware of an assessed but unpaid federal tax liability until the person goes through U.S. Customs and is detained by Immigration and Customs Enforcement. U.S. Customs agents may detain these individuals to ascertain what assets they have in the United States, the duration of their trip, where they are staying, vehicle registration information, and similar information. Agents also may inquire about the taxpayer's employment relationships in the United States or any personal services performed in the United States, to establish wage garnishment opportunities. Thereafter, U.S. Customs agents will alert an IRS coordinator and transmit this information through a referral program. Typically, an investigation request will be sent to an IRS agent in the region in which the taxpayer is traveling to follow up with the taxpayer (IRM [section]5.1.12.26).

TECS and Notice of Federal Tax Lien

The procedures governing TECS have two key requirements for taxpayer information to be included:

1. The individual taxpayer must live outside the United States; and

2. The individual taxpayer must have an existing filed federal tax lien (IRM [section]5.1.12.26.5.1).

A Notice of Federal Tax Lien may be filed on a taxpayer's real or personal property under Sec. 6321 when the taxpayer fails to pay taxes allegedly owed after the notice-and-demand period expires. A Notice of Federal Tax Lien that is properly filed has the effect of publicly alerting creditors that the IRS has a priority claim against the taxpayer's real or personal property. If a Notice of Federal Tax Lien is filed in the wrong location, the IRS will not have priority over a later purchase; holder of a...