Stop Terror-Financing and Tax Penalties on American Hostages Act

This bill provides tax relief for U.S. nationals wrongfully detained or held hostage abroad by ignoring the time spent detained when calculating tax penalties, interest, and collection deadlines. It requires the State Department and Attorney General to identify affected individuals by 2025, enabling Treasury to refund penalties paid during detention periods. The bill also revokes tax-exempt status for organizations providing material support to terrorist groups, with a 90-day cure period before designation. These provisions apply to tax years ending after enactment for hostages and future designations for terrorist-supporting organizations.