Dive Brief:

• The Internal Revenue Service said it is providing tax relief to individuals and businesses affected by the recent terrorist attacks against the State of Israel, giving an extension to Oct. 7, 2024 for various filing and payments deadlines to those qualified taxpayers, according to a Friday IRS release.
• Those who qualify for the relief include any individual, business entity or sole proprietor whose principal place of business is in the area that includes Israel, the West Bank or Gaza; anyone killed, injured or taken hostage due to the Oct. 7 attacks in Israel, or relief workers or individuals affiliated with recognized government or philanthropic organizations assisting in the area. 
• The Internal Revenue Code’s Section 7508A(a) gives the Treasury Secretary authority to postpone the deadlines for up to one year if a taxpayer is determined by the secretary to be affected by a terrorist or military action as defined in the code, IRS Notice 2023-71, titled Relief for Taxpayers Affected by the Terroristic Action in the State of Israel, states. The “secretary has determined that the terrorist attacks beginning on October 7, 2023, against the State of Israel constitute terroristic action within the meaning of section 692(c)(2),” the IRS notice states. 

Dive Insight:

The tax relief announcement Friday did not name U.S. Treasury Secretary Janet Yellen, who on Monday told Sky News that it was too early to speculate on the economic consequences of the Israeli-Palestinian conflict, saying that it would depend on whether the conflict spreads to a wider region, Reuters reported. On Tuesday President Biden was poised to visit Israel, amid concerns about a spiraling humanitarian crisis in Gaza, The Wall Street Journal reported. 

In addition to businesses located in the area, the IRS relief also is extended to individuals, businesses or sole proprietors, or estates or trusts whose books, records or tax preparers are located in the area.

The actions that qualify for the IRS extensions include: filing income tax returns, estate tax, gift tax, generation-skipping transfer tax, excise tax other than firearms tax, harbor maintenance tax, or employment tax. However, the IRS noted that calendar-year corporations whose pre-existing 2022 filing extensions run out on Oct. 16, 2023 have more time to file, but not to pay.

Affected taxpayers whose principal residence or principal place of business is not located in the covered area should call the IRS disaster hotline at (866) 562-5227 to request relief and international callers may call (267) 941-1000, the IRS says.

An IRS spokesperson was not immediately available to comment.