Income tax on Suquamish pot sales?

Suquamish tribe is federally recognized. It’s going to sell marijuana. “As governmental entities, federally recognized tribes are not subject to income taxes.” – IRS. But that doesn’t cover all income:

ITG FAQ #10 Answer-Is income from the operation of a motel or a smoke shop on allotted land taxable?  Income from the operation of a motel or a smoke shop on allotted land has been held to derive from labor and the use of capital improvements rather than directly from the land itself, and has accordingly been held taxable. (Critzer v. United States, 597 F.2d 708 (Ct.Cl.) cert denied).

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URLs:

http://www.goia.wa.gov/tribal-directory/tribaldirectory.pdf

http://www.seattletimes.com/seattle-news/marijuana/deal-to-let-suquamish-tribe-open-kitsap-county-pot-store/

http://www.irs.gov/Government-Entities/Indian-Tribal-Governments/ITG-FAQ-%236-Answer-Are-federally-recognized-tribes-subject-to-income-taxes%3F

http://www.irs.gov/Government-Entities/Indian-Tribal-Governments/ITG-FAQ-%2310-Answer-Is-income-from-the-operation-of-a-motel-or-a-smoke-shop-on-allotted-land-taxable%3F

 

 

 

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Author: patoglesby

From 1982 to 1990, I worked in tax policy for Committees of the United States Congress. In recent years, I was Adjunct Lecturer at UNC-Chapel Hill's Business School and then Adjunct Professor at its Law School.

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