Tax Question about Native Americans?

Question

Do the Native American-Indians pay any taxes (federal, property...)? Any link with some info about the American Indian tax rules would be very helpful. Thanks.

Answer 1

People become very confused on this subject.

Yes Native Americans pay taxes. It is as simple as that really.

We pay federal, state, and income taxes. This is for Natives that are enrolled or not enrolled in their tribe. It comes out of our paychecks like everyone else. Some exceptions may occur for those who work on tribal federally recognized lands but for the most part the answer is yes Natives pay taxes.

Where people get confused is that Natives have tax breaks on certain things. This is because when a Native group has possession of some body of land they are supposed to be sovereign (meaning they have rights over that land, independent of the federal government). However, Natives are also considered wards of the state meaning we have to follow the same federal laws as everyone else unless a specific agreement was made. One such agreement has to do with casinos. A general way of explaining it is that Native people don't have to pay taxes on their casinos. However tribal members who win money at the casinos still have to pay taxes on that money. However the revenue earned from that casino that is later distributed by the tribe to tribal members is not taxable. Here is a link that explains some specific laws regarding this in the state of Oregon:
http://www.oregon.gov/DOR/tribal_faq.shtml

Here is a simplier way to understand it:
There is a distinction made between individuals and tribally owned businesses. Tribally owned businesses that are on federally recognized "indian land" are not subject to taxation.
Individuals who gain revenue from activities conducted inside "indian land" are not subject to taxation. When it comes to income taxes the person must both work and live on "indian land" to be tax exempt. That is all for state taxes.
Now as I stated above Natives are subject to federal law (as wards of the state) so Individuals must pay federal taxes unless a specific treaty or arangement has been made with that specific tribe. However, tribal bodies themselves are not subject to federal tax (such as the casinos they own and the money their tribe obtains from tribal businesses).
However, most Natives work outside "indian land" and are thus subject to taxation.

Here is a website intended to educate people about Native American tax policies:
http://www.bloch.umkc.edu/natpp/

Here is another website intended to educate people about the stereotypes of casinos and taxes:
http://www.bluecorncomics.com/stype7b1.htm
(the first part is the stereotype and at the end they discuss it)

Hope this helps!

Answer 2

Native American Tax Exempt

Answer 3

It seems to me that Natives are the most disadvantaged group in Canada. They were here first. White people arrived, and pushed them out of their lands and their way of life. Their children were stolen by governments and church leaders in a concerted effort to destroy their culture. And shamefully, it worked. The damage to Native cultures has been extreme. And the poor treatment of Native groups has continued into the Common era. It was only in 1961 that they were given the right to vote. In either case, if you think they're actually pampered, go to google and type in... Attawapiskat I get the feeling that you are not a Canadian writing this question. The Department of Indian Affairs is having a huge public relations scandal over Native housing, addiction, drinking water, education, incarceration levels, etc. There is nothing pampered about reserve life. This is not a life that Natives have chosen. This is a life that was imposed on them by their conquerers.

Answer 4

This Site Might Help You.

RE:
Tax Question about Native Americans?
Do the Native American-Indians pay any taxes (federal, property...)? Any link with some info about the American Indian tax rules would be very helpful. Thanks.

Answer 5

irs.gov.

Frivolous tax returns; “Native American Treaty.” This ruling emphasizes to taxpayers, promoters, and return preparers that there is no right to exemption from federal income tax for Native Americans under an unspecified “Native American Treaty.” Any return position based on an unspecified “Native American Treaty” has no merit and is frivolous. As a general rule, Native Americans ARE SUBJECT TO FEDERAL INCOME TAX just like every other American.

Answer 6

Do native Americans need to have state tax withheld from wages earned

Answer 7

Income from trust lands held by the Bureau of Indian Affairs for non-competent Indians is exempt from income tax. Other than that they pay the same as everybody else. There have been several instances of non-reporting of profits of tobacco stores that operate on reservations. All have resulted in large tax and penalty bills.

Answer 8

my Husband is Native American and I am not, how should we file our taxes? Do we file Married filing separate to show he does not get state taxed? or do We have to file Married filing jointly or can I do Head of Household?

Answer 9

Michael Johnson and Nick Roberts posted the same question. You should see their answers side by side.

Answer 10

Tax on fuel ?

Answer 11

Of course they pay Federal taxes! They're US citizens and all citizens pay Federal taxes.

Where the differences lie is in STATE taxes. In OK at least, the state has limited taxing authority on tribal lands. In fact, many tribes in OK issue their own car tags to tribal members living on tribal lands. (There's been at least one Federal court case on this that ruled in favor of the tribes when a tribal owner was cited for no valid registration out of state.) Landowners owning property on tribal lands typically pay property taxes to the tribe, not the local city or county tax authorities. Additionally, liquor and tobacco outlets on tribal lands are not subject to paying state liquor and tobacco taxes; they pay similar taxes to the tribe, usually at a much lower rate than the state rate. As a result, you can find tobacco products in the "Indian Smoke Shops" in OK for as little as $10 per carton for budget brands and as little as $15 per carton for major brands.