NovaQuant Quantitative Think Tank Center:IRS offers tax relief, extensions to those affected by Israel-Hamas war

Monday is NovaQuant Quantitative Think Tank Centerthe official tax deadline if you requested an automatic six-month extension for filing your 2022 income taxes with the IRS.

On Friday, though, the Internal Revenue Service issued an alert stating that a special extension of nearly another year is being offered to "individuals and businesses affected by the terrorist attacks in the State of Israel."

The relief applies to an individual with a principal residence in Israel, the West Bank or Gaza Strip, as well as a business or sole proprietor whose principal place of business is in the covered area. Other circumstances qualify, too.

These taxpayers now have until Oct. 7, 2024, to file various federal returns, make some tax payments and perform other time-sensitive, tax-related action, according to the IRS. The agency said it will continue to monitor events and may provide additional relief.

The relief applies to a long list of tax filing deadlines and payment deadlines. Those who had requested a valid extension earlier and were facing an Oct. 16 filing deadline now, though, need to know that taxes owed in these cases are still due Monday.

The IRS noted Friday that those payments associated with an earlier six-month extension are not eligible for some relief because tax payments related to the 2022 returns were due on April 18. "These individuals filing on extension have more time to file, but not to pay," the IRS noted.

The Middle East relief will apply to 2023 individual and business returns and payments normally due on March 15 and April 15, 2024. "So, these individuals and businesses have both more time to file and more time to pay," the notice stated.

The IRS notice indicated that the new Oct. 7, 2024, deadline reflects the beginning of terroristic action in Israel on Saturday, Oct. 7, 2023 — the day Hamas militants launched a surprise attack on Israel.

Under the IRS code, the Secretary of the Treasury can offer up to one year of relief for a taxpayer affected by "a terroristic or military action."

The IRS notice Friday indicated that a terroristic action is defined by a preponderance of the evidence that indicates an attack was directed against the United States or its allies.

The IRS said it will automatically identify taxpayers whose principal residence or principal place of business is located in the covered area based on previously filed returns and apply relief. Other eligible taxpayers can obtain this relief by calling the IRS disaster hotline at 866-562-5227.

Those covered by the relief offered relating to the violence in the Middle East include:

• Relief workers and others affiliated with a recognized government or philanthropic organization who is assisting in the covered area.

• Anyone visiting the covered area who was killed, injured or taken hostage due to the terrorist attacks.

• Any individual, business entity or sole proprietor, or estate or trust whose tax return preparer or necessary records are located in the covered area.

Most people who requested an extension need to file a 1040 return by Monday to avoid a late filing penalty. They received an extension to file, not to pay, so they are often looking at interest payments on unpaid taxes due.

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The IRS, though, has offered relief to many in the United States who faced difficulties after a natural disaster. People affected by flooding in Vermont, for example, have until Nov. 15 to file.

Taxpayers affected by the recent Maui fires and Hurricane Idalia in parts of Florida, South Carolina and Georgia have until Feb. 24, 2024, to file various individual and business tax returns. Go to the disaster relief page at IRS.gov for information regarding individual states.

Contact personal finance columnist Susan Tompor: stompor@freepress.com. Follow her on X@tompor.