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ITG FAQ #6 Answer-What are treaty-sourced income distributions?

Treaty-sourced income distributions might include income distributions to tribal members from any treaty. In Squire v. Capoeman, it is well settled that, unless a provision of a statute or treaty expressly confers an exemption, Indians are subject to the federal income tax to the same extent as is any other citizen.

Internal Revenue Code section 7873 establishes special provision for treaty based fishing rights. Refer to FAQs regarding IRC Section 7873 for more details.

Treaties that denote special tax treatment, or specifically exclude certain items of income from federal taxation, may pertain to oil and gas interests, timber, fishing rights, mineral royalties, and other items, some of which are discussed later.

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Page Last Reviewed or Updated: 02-Aug-2016