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ITG FAQ #10 Answer-A tribe has a separate entity under Section 501(c)(4) which the tribal council controls. Is it subject to FUTA?

A tribal government is a federally recognized tribe with its own Employer Identification Number (EIN). They have a separate entity with a different EIN that is exempt from income tax under Section 501(c)(4). The board’s members consist of the entire tribal council, and they control the entity. Is the 501(c)(4) entity subject to FUTA?

No. The entity has no liability for FUTA. Although there are two separate EINs, the facts suggest the entity is either operated directly by the tribe or wholly owned by the tribe, since the entire tribal council constitutes the board of the entity.

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Page Last Reviewed or Updated: 06-Dec-2016