U.S Code last checked for updates: Jun 17, 2024
§ 7873.
Income derived by Indians from exercise of fishing rights
(a)
In general
(1)
Income and self-employment taxes
No tax shall be imposed by subtitle A on income derived—
(A)
by a member of an Indian tribe directly or through a qualified Indian entity, or
(B)
by a qualified Indian entity,
from a fishing rights-related activity of such tribe.
(2)
Employment taxes
(b)
Definitions
For purposes of this section—
(1)
Fishing rights-related activity
(2)
Recognized fishing rights
(3)
Qualified Indian entity
(A)
In general
The term “qualified Indian entity” means, with respect to an Indian tribe, any entity if—
(i)
such entity is engaged in a fishing rights-related activity of such tribe,
(ii)
all of the equity interests in the entity are owned by qualified Indian tribes, members of such tribes, or their spouses,
(iii)
except as provided in regulations, in the case of an entity which engages to any extent in any substantial processing or transporting of fish, 90 percent or more of the annual gross receipts of the entity is derived from fishing rights-related activities of one or more qualified Indian tribes each of which owns at least 10 percent of the equity interests in the entity, and
(iv)
substantially all of the management functions of the entity are performed by members of qualified Indian tribes.
For purposes of clause (iii), equity interests owned by a member (or the spouse of a member) of a qualified Indian tribe shall be treated as owned by the tribe.
(B)
Qualified Indian tribe
(c)
Special rules
(1)
Distributions from qualified Indian entity
(2)
De minimis unrelated amounts may be excluded
If, but for this paragraph, all but a de minimis amount—
(A)
derived by a qualified Indian tribal entity, or by an individual through such an entity, is entitled to the benefits of paragraph (1) of subsection (a), or
(B)
paid to an individual for services is entitled to the benefits of paragraph (2) of subsection (a),
then the entire amount shall be entitled to the benefits of such paragraph.
(Added Pub. L. 100–647, title III, § 3041(a), Nov. 10, 1988, 102 Stat. 3640.)
cite as: 26 USC 7873