FAQs for Indian Tribal Governments regarding Employee Plans and Exempt Organization Issues


These frequently asked questions and answers are provided for general information only and should not be cited as any type of legal authority. They are designed to provide the user with information required to respond to general inquiries. Due to the uniqueness and complexities of Indian law and Federal tax law, it is imperative to ensure a full understanding of the specific question presented, and to perform the requisite research to ensure a correct response is provided.

  1. Are Federally Recognized Tribes (FRTs) tax-exempt?
  2. Are federally recognized tribes considered organizations to which charitable contributions are tax-deductible?
  3. Can a federally recognized tribe qualify as a charitable organization exempt from taxation under IRC section 501(c)(3)?
  4. Can donations to a food bank that is operated under section 501(c)(3) of the Internal Revenue Code qualify for the enhanced deduction by the donor under section 170(e), if the food bank in turn donates the food to a federally recognized Indian tribe?
  5. What are the requirements of Section 170(e)?
  6. If an Indian tribal governments sets up a 501(c)(3) entity for the purpose of providing care to the ill, needy, or infants, can they then accept food donations from a food bank that qualifies for the enhanced deduction by the donor?  
  7. Are Tribal Council members eligible to participate in a 401(k) Plan sponsored by the tribe? 
  8. Can tribal members contribute to an Individual Retirement Account (IRA) if their only income is derived from fishing rights-related activities under section 7873 of the Code?  
  9. Can an Indian tribal government set up a 401(k) plan with contributions based on section 7873 income?