In Notice 2023-71, the IRS provided tax relief for individuals affected by Hamas’ terroristic action in the State of Israel beginning on October 7, 2023.  Notably, this relief is not limited to eligible taxpayers in Israel, but also extends to eligible taxpayers in the Gaza Strip and the West Bank.

       Pursuant to Notice 2023-71, the IRS has extended, until October 7, 2024, certain filing, payment, and other time-sensitive acts due to be completed on or after October 7, 2023, and before October 7, 2024.  These acts include, but are not limited to:

  • Filing any return of income tax, estate tax, gift tax, generation-skipping transfer tax, excise tax (other than firearms tax), harbor maintenance tax, or employment tax;
  • Paying any income tax, estate tax, gift tax, generation-skipping transfer tax, excise tax (other than firearms tax), harbor maintenance tax, or employment tax, or any installment of those taxes;
  • Making contributions to a qualified retirement plan;
  • Filing a petition with the Tax Court;
  • Filing a claim for credit or refund of any tax;
  • Bringing suit upon a claim for credit or refund of any tax; and
  • Any other acts identified in Treasury Regulation section 301.7508A-1(c)(1) or Revenue Procedure 2018-58 (December 10, 2018).

       Notice 2023-71, however, also extends the time for the IRS to perform certain time-sensitive acts with respect to taxpayers who qualify for relief under Notice 2023-71.  As with eligible taxpayers, the IRS deadline for completing acts due to be completed on or after October 7, 2023 and before October 7, 2024 is extended to October 7, 2024.  These acts include, but are not limited to:

  • Assessing any tax;
  • Giving or making any notice or demand for the payment of any tax, penalty, and interest owed to the IRS;
  • Collecting, by levy or otherwise, tax, penalty, and interest owed to the IRS;
  • Bringing suit by the United States, or any officer on its behalf, with respect to and tax, penalty, or interest owed to the IRS, and allowing a credit or refund of any tax; and
  • Any other acts identified in Treasury Regulation section 301.7508A-1(c)(2).

       The IRS identified the following types of individuals as eligible for relief under Notice 2023-71:

  • Any individual whose principal residence, and any business entity or sole proprietor whose principal place of business, is located in Israel, the West Bank, or the Gaza Strip;
  • Any individual affiliated with a recognized government or philanthropic organization and who is assisting in Israel, the West Bank, or the Gaza Strip, such as a relief worker;
  • Any individual, business entity, or sole proprietor, or estate or trust whose tax return preparer or records necessary to meet a deadline for postponed acts are located in Israel, the West Bank, or the Gaza Strip;
  • Any spouse of an affected taxpayer, solely with regard to a joint return of two married individuals; and
  • Any individual visiting Israel, the West Bank, or the Gaza Strip who was killed, injured, or taken hostage as a result of Hamas’ October 7, 2023 terrorist attacks.

       The IRS plans to automatically identify taxpayers whose principal residence or principal place of business is located in Israel, the West Bank, or the Gaza Strip based on previously filed returns and apply relief.  Nonetheless, taxpayer entitled to relief under Notice 2023-71 and who take advantage of the proffered relief should make sure to note, on any returns filed or payments made during the extension period, that the return is filed and/or the payment is made “in accordance with Notice 2023-71.”

       Other taxpayers entitled to relief under Notice 2023-71 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; international callers may call (267) 941-1000.

       At Fox Rothschild, our Israel Practice Group assists Israeli companies of any size, from startups to market leaders, and we place special emphasis on supporting Israeli-based companies in developing technology and innovation. Our attorneys work closely with their clients to develop initial business plans as well as structure and negotiate Israeli-related business transactions, including expansion into the U.S. market. As a full-service firm, we counsel Israeli companies on matters of U.S. corporate, employment and tax law as well as national and cross-national litigation and arbitration matters.  For more information, on IRS Notice 2023-71 or the firm’s Israel Practice Group, please contact the Brian C. Bernhardt or any member of the Fox Rothschild Israel Practice Group.