YourVoice.Now Summary
Your MoneyAmericans held hostage or wrongfully detained abroad would stop owing IRS late penalties — and could get past ones refunded back to 2021.
Your Money
Filing a return, paying tax, going to Tax Court, and asking for a refund all have deadlines. Those clocks would not run while you were held abroad.
It can take time for the government to formally rule that you were held. Any penalties or interest the IRS charged or collected in the meantime would be erased and paid back, with no claim needed.
The State Department and the Justice Department would build the list and hand it to the Treasury. It covers people who were charged or paid these penalties for time held since January 1, 2021. Those people, their spouses, and their dependents could apply.
The Treasury would have to tell each person on that list that they may qualify. Notice is due within 90 days of the law for anyone already released, or within 90 days of release for anyone freed later.
Refund claims normally must be filed within three years, and the amount is capped by how recently you paid. Instead you would get one year from the date of your notice, with no cap.
Two rules normally cut off that interest — one when a return comes in late, one when a refund goes out within 45 days. Neither would apply once your return counts as on time. But the pause itself does not add interest to money the IRS owes you.
The time you are held would not count when the IRS decides if you filed late. Penalties, interest, and IRS collection would be put on hold from the day your detention began, a date the Treasury sets.
More about this bill
If you are taken hostage or wrongfully detained abroad, the IRS would stop charging you late penalties. Interest on what you owe would stop building too. Your deadlines to file, pay, or claim a refund would pause for the whole time you are held. So would IRS collection, such as levies. Your spouse would get the same break. This pause covers tax years that end after the law takes effect. Money already taken could come back. The Treasury would set up a refund program by January 1, 2027. It would pay back penalties and interest charged for tax years ending before this law. Only amounts tied to periods since January 1, 2021 would count. The government would have to send you a notice within 90 days of your release, or of the law passing if you are already home. You would then have one year to file the claim. The State Department decides who was wrongfully detained. The Justice Department decides who was taken hostage, through a team called the Hostage Recovery Fusion Cell.
Congressional Summary
End Tax Penalties on American Hostages Act This bill extends certain federal tax deadlines for U.S. nationals who are unlawfully or wrongfully detained abroad or held hostage abroad and their spouses. The bill also allows for an abatement and refund of additional taxes, interest, and penalties assessed to such individuals for failing to meet a federal tax deadline during a period of detention. Specifically, under the bill, the time period during which a U.S. national is unlawfully or wrongfully detained abroad or held hostage abroad is disregarded in determining certain federal tax deadlines, including deadlines for filing a return for and paying federal income, estate, gift, employment, or excise taxes; a tax credit or refund claim; and the determination, assessment, and collection of additional taxes, interest, or penalties. The bill requires the Department of State and the Department of Justice to annually provide the Internal Revenue Service (IRS) with lists to identify U.S. nationals who qualify for an extension. The bill also requires the IRS to (1) abate and refund additional taxes, interest, and penalties assessed for any tax year ending during a period of detention for which an extension of a federal tax deadline is permitted; and (2) establish a program allowing U.S. nationals unlawfully or wrongfully detained abroad or taken hostage abroad (or their spouse or dependent) to claim a refund of additional taxes, interest, and penalties assessed for any tax year ending during a period of detention from 2021 to the bill’s enactment date.
Details
- Congress
- 119th
- Chamber
- House
- Status
- summarized
- Action
- Passed House
- Action Date
- 2026-09-15
- Date Added
- 2026-09-09
- Source
- Congress.gov →
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