Hundreds of thousands of US citizens may have to scrap their holiday plans, the Internal Revenue Service said, as it is enforcing a law allowing authorities to revoke and deny passports to those owing over $51,000 in unpaid taxes.

Some 362,000 people may fall under the scope of the 2015 law as early as the end of this year, the Wall Street Journal reported on Friday, citing an IRS spokesperson.

The Fixing America's Surface Transportation (FAST) Act, which became a law in December 2015, allows the State Department and the IRS to refuse to issue passports to those with "seriously delinquent" debts that are defined as "an unpaid, legally enforceable federal tax liability" of more than $51,000, including interest and penalties. That rule envisions denying first-time passport applications, as well as the renewal of the travel document. In a worst-case scenario, a valid passport can be revoked by the State Department.

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However, an IRS representative told the publication in June that the authorities have not gone that far as of yet and, for now, they have contented themselves with simply denying applications. It's not known how many tax debtors have already seen their travel plans ruined, with the State Department saying that it has already denied some applications.

The IRS, meanwhile, said that the process of alerting the State Department about individuals with outstanding debts is in full swing and should be completed by the end of the year.

An ongoing crackdown on tax debtors has been deemed a success, with IRS Division Commissioner Mary Beth Murphy telling the WSJ that as many as 220 people have paid off their debts by June, replenishing the federal budget with $11.5 million.

Notably, since the sum of the debt also includes interest, penalties and assessed tax, it means that while you think you owe much less than the threshold amount, interests and penalties can make up for the difference.

While strict, the legislation does allow for some exemptions. A taxpayer is not subjected to the law if he or she is disputing the debt assessment in court or is about to settle the issue with IRS through compromise.

Not eligible to the rule are people in distress, including those going through bankruptcy, living in a federally declared disaster area and victims of identity theft.

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The exemption is also granted to members of the armed forces deployed into combat. In case a US citizen is already abroad, the IRS and the State Department may not enforce the law, delaying its implementation out of humanitarian or emergency reasons so the debtor can return home.

Critics of the law argue that its overzealous and instant implementation is leaving taxpayers who are, in principle, willing to clear their debts, with too little time to do it.

At the moment, the IRS sends the indebted taxpayer a letter, notifying them that a passport will not be issued because of overdue debts almost at the same time as it notifies the State Department, which means the taxpayer must act in a rush. The State Department then holds the passport application or renewal open for 90 days to allow for the resolving of any errors, making a full payment, or entering a satisfactory payment plan.

"There is no grace period for resolving your debt before the State Department revokes an existing passport," the IRS said in February, as it embarked on enforcing the law.