U.S. Department of the Treasury

“Today we are providing tribes with important clarity by finalizing guidance that per capita distributions of tribal trust assets generally are not subject to federal income tax,” said Assistant Secretary for Tax Policy Mark Mazur. “This guidance was informed by extensive consultation with tribal governments, illustrating the value of these discussions to help us better understand the needs of tribal governments.” 

The Department of the Interior is responsible for holding in trust certain funds on behalf of federally recognized Indian tribes.  Under the Per Capita Act of 1983, tribes are authorized to make per capita distributions from these trust accounts directly to tribal members subject to the approval of the Department of Interior.  In September 2012, Treasury and the IRS released guidance on per capita distributions from specific settlements, and have since received requests to address the tax treatment of per capita payments more broadly. 

 

While developing this guidance, Treasury convened listening sessions and other consultations to facilitate a government-to-government dialogue between the federal government and tribes, and to understand key tribal concerns.

 

This notice supersedes Notice 2014-17, which was interim guidance to allow Indian tribes time to review and provide feedback. The comments and feedback we received informed our final guidance on per capita distributions made by the Secretary of the Interior or an Indian tribe out of a tribal “Trust Account.” 

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