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Native American Casino And Tax Rules That May Surprise You

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Image credit: Getty Images via daylife 1.
Federal Law Regulates Indian Gaming.
Inthe Supreme Court ruled that tribes can conduct gaming on Native American lands go here by state regulation in states that allow gaming.
A year later, Congress enacted the Indian Gaming Regulatory Act of 1988 IGRAcreating a regulatory framework for gaming on Indian lands.
The National Indian Gaming Commission within the Department of the Interior has oversight.
here are Tax Exempt.
Yet Native American tribes and their wholly owned tribal corporations are not subject to federal income taxes on their earnings.
The Exemption is Absolute.
Some types of tax-exempt organizations are taxed on some types of income.
Tribes are exempt from federal income taxes even when conducting commercial activities.
They can form corporations to conduct business and their income remains exempt.
Individual Native Americans are Taxed.
Native Americans are U.
Even exempt tribal income can be taxed when distributed to individual members of the tribe.
One of the more complicated provisions of IGRA permits Native American tribes to make per capita distributions of revenue from gaming activities to tribe members.
These per capita distributions are taxed.
But Some Payments to Native Americans are Exempt.
In general, to be tax-free, payments must be made under a governmental program; be for the promotion of general welfare i.
This General Welfare Exception from income has become increasingly controversial as applied to tribal members and the IRS is being asked to weigh in.
State Taxes are Tricky.
Absent an express authorization from Congress, states do not have the power to tax Native Americans living on a reservation whose income is derived from reservation sources.
However, a state maytax Native Americans on income including wages from tribal employment if they reside in the state but outside the reservation.
As with many other tax rules, these rules are becoming more controversial.
Expect renewed discussion of these rules and their limits in the future.
Wood north carolina gambling tax free weekend 2020 law within San Francisco.
This discussion is not intended as legal advice, and cannot be relied upon for any purpose without the services of a qualified professional.
I handle tax matters across the U.
You can reach me at Wood WoodLLP.

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Total 23 comments.