Desert Storm Taxpayers Have Extra Time to File

Members of the Armed Forces and support personnel who served in Operation Desert Storm have at least 180 days -- and in most cases up to 285 days -- from the date they leave the combat zone to file their 1990 federal income tax returns.

Although federal tax law allows these taxpayers to postpone filing their tax returns for 180 days, the Internal Revenue Service has determined that the 180-day postponement period is intended to run consecutively, not concurrently, with the tax filing season.

This means that military and support personnel who were in the designated Desert Storm area at any time from August 2, 1990, through jan. 1, 1991, will not be required to file until 285 days after they leave the combat zone. The postponement period in these situations is made up of the 180 days provided by law and the 105 days of the tax filing season, January 1 to April 15.

IRS explained that military and support personnel who entered the combat zone after January 1 may postpone filing their tax returns for 180 days plus the number of days between the date they entered th4 combat zone and April 15.

For example, a taxpayer who served in the combat zone from January 20 through March 15 will have until Dec. 6, 1991, to file, which is 266 days after they left the combat zone. This filing postponement period equals the 180 days plus the 86 days from January 20 to April 15.

Taxpayers still in the combat zone can postpone filing their tax returns for as long as they are in the combat zone. Then, when they leave the combat zone their additional time to file starts. For example, a taxpayer who was in he combat zone on January 1 and leaves April 20 will have 285 days from April 20 to file the tax return. If this taxpayer had entered the combat zone on January 20, the filing date would be 265 days from April 20.

If the combat zone designation is cancelled by executive order before a taxpayer leaves the combat zone, the additional postponement period starts when the designation is cancelled.

Guidance on postponing tax filing and other relief measures are covered in the new IRS publication 945, "Tax Information for Those Affected by Operation Desert Storm" that will be available.

IRS today offered guidance on some of the other issues covered in Publication 945 -- retroactive interest on refunds, IRA contributions for 1990 and interest free payments of 1990 tax balances.

A tax refund issued by IRS after April 15 will include interest from April 15 if the return is filed by the postponed deadline.

Taxpayers who owe additional payment with their tax returns will not be charged interest or late payment penalty if they file by the postponed deadline.

Because the filing date for taxpayers who served in Desert Storm is postponed, IRA contributions for 1990 may be made up until the date the taxpayer is required to file.

IRS also clarified today that there is not exclusion of military pay received before January 1991 by persons in the combat zone.

Taxpayers are reminded to write "Desert Storm" at the top of their tax returns. This will alert IRS to those persons entitled to these tax relief measures. Because tax collection and examination actions are postponed, Operation Desert Storm military and support personnel who receive correspondence from IRS on these matters should mark "desert storm" at the top of the correspondence and return it to IRS.

IRS said taxpayers who served in Operation Desert Storm or their family members may call IRS at 1-800-829-1040 for tax information or visit their local IRS office for help in preparing tax returns, including electronic filing in those offices with that capability.

The new IRS publication 945, covering Operation Desert Storm tax issues, will be available in April by calling 1-800-TAX-FORM (1-800-829-3676).

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