Tax information for Indian tribal governments

U.S. Department of the Treasury and the Internal Revenue Service published final regulations in the Federal Register on May 4, 2026. The final regulations provide that amounts paid to a member of an Indian Tribe as remuneration for services performed in a fishing rights-related activity may be treated as compensation for purposes of applying the limits on qualified retirement plan benefits and contributions.  These regulations affect participants, beneficiaries, sponsors, and administrators of Tribal plans. 

The U.S. Department of the Treasury (Treasury) and the IRS have published a Notice of Proposed Rulemaking (NPRM) titled "Increase in Threshold for Requiring Information Reporting with Respect to Certain Payees; Extension and Modification of Limitation on Wagering Losses."

This NPRM contains proposed amendments to regulations impacted by amendments to the Internal Revenue Code made by sections 70114 and 70433 of Public Law 119-21, 139 Stat. 72 (July 4, 2025), commonly known as the One, Big, Beautiful Bill Act (OBBBA). The NPRM would update the dollar thresholds in regulations governing information reporting for various types of payments made in the course of a trade or business, including for slot machine payouts, to reflect the new increased statutory threshold of $2,000, which the statute requires to be adjusted for inflation going forward. The NPRM would likewise update the corresponding backup withholding regulations.

Additionally, the NPRM reflects OBBBA section 70114(a), which amends section 165(d) to limit the deduction of losses from wagering to 90 percent of the amount of wagering losses during a taxable year and only to the extent of gains from wagering transactions during a taxable year. The proposed regulations would also make corresponding changes to the treatment of combined losses of spouses from wagering transactions to reflect the changes made by the OBBBA.

Treasury is accepting written comments through June 16, 2026. Commenters are strongly encouraged to submit public comments electronically. Submit electronic submissions via the Federal eRulemaking Portal at Regulations.gov (indicate IRS and REG-113229-25) by following the online instructions for submitting comments. 

The U.S. Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) issued final regulations to implement Section 139E of the Internal Revenue Code, created by the Tribal General Welfare Exclusion Act of 2014.

More details:

Federal Register : Tribal General Welfare Benefits

Tribal general welfare guidance | Internal Revenue Service

Treasury and IRS published final regulations regarding wholly owned tribal entities on December 16, 2025. The regulations provide that an entity wholly owned by one or more Indian Tribal governments, within the meaning of Section 7701(a)(40), that is organized or incorporated under the laws of the Tribe or Tribes that own it (wholly owned Tribal entity) is not recognized as a separate entity for Federal tax purposes. A single member limited liability company organized under the laws of the Tribe that owns it would be a wholly owned Tribal entity. Additionally, the regulations provide that wholly owned Tribal entities, as well as Federally-chartered corporations incorporated under Section 17 of the Indian Reorganization Act of 1934, as amended, 25 U.S.C. 5124 (Section 17 corporations), or under Section 3 of the Oklahoma Indian Welfare Act, as amended, 25 U.S.C. 5203 (Section 3 corporations), are treated, for purposes of making Section 6417 elections (including determining eligibility for and the consequences of such elections), as instrumentalities of the Indian Tribal government(s) that wholly own them.

More information concerning making an Elective Payment Election under Section 6417 is available on the Elective Payment and Transferability webpage. An elective payment election cannot be made on an amended return.

Wholly owned tribal entities may be entitled to a refund of income taxes previously paid. If you are eligible for a refund, please complete and file Form 1120-X PDF within the permitted statute of limitations. Per instructions on page 3 of Form 1120-X, under “What to Attach”, be sure to include the appropriate schedule, statement, or form.

• For ease of processing, write “Wholly Owned Tribal Entity” at the top of the Form 1120-X or in Form 1120-X Part II, and send the return to:

Internal Revenue Service
1973 North Rulon White Blvd.
M/S 7700 Attn: GECU
Ogden, UT 84201 

Section 70402 of the One Big Beautiful Bill makes the adoption tax credit partially refundable up to $5,000 (indexed for inflation) beginning in taxable years starting after December 31, 2024. Any carried forward amount cannot be used to calculate the refundable portion of the credit in future years.

Section 70403 of the One Big Beautiful Bill recognizes Indian Tribal governments for purposes of determining whether a child has special needs for purposes of the adoption tax credit.

This provision provides parity to Indian Tribal governments, giving Tribal governments the same ability as State governments to determine whether a child has special needs for the purposes of the adoption tax credit.

A child is considered to be special needs if:

1. A State or Tribal government has determined that the child cannot or should not be returned to the home of their parents,
2. A State or Tribal government has determined that it would be difficult to place the child for adoption without providing adoption assistance to the adoptive family due to a specific factor or condition (such as ethnic background, age, medical condition or disability, or membership in a minority or sibling group), and
3. The child is a United States citizen or resident.

When a child is deemed special needs by a State or Tribal government, the adoptive family becomes eligible, subject to income limitations, for the full adoption tax credit ($17,280 per eligible child in 2025) for the tax year the adoption becomes finalized, regardless of the amount of qualified adoption expenses actually paid or incurred for the adoption.

For more information, visit the IRS Adoption Credit webpage, Instructions to Form 8839, Qualified Adoption Expenses PDF, Publication 5851-B, Adoption Tax Credit PDF, and Treasury, IRS issue FAQs about general refundability and recognizing Indian tribal governments for purposes of making a special needs determination for the Adoption Tax Credit. 

The newly eligible entities join sole proprietors, S corporations, and C corporations that are already able to access the platform. The expansion supports the agency’s ongoing service improvement effort by broadening digital access to more segments of the business community.

The Business Tax Account is a secure, centralized platform that allows eligible users to manage their federal tax responsibilities online. Through BTA, users and designated officials can:

• View tax balances, make payments, and see payment history
• Download select digital notices
• View eligible transcripts, such as payroll and income
• Request a tax compliance check
• See the business name and address on file with the IRS

For more information or to set up a Business Tax Account, visit www.irs.gov/businessaccount.