TaxNewsFlash-Exempt Organizations

October 23, 2008
No. 2008-104

PRINTABLE VERSION

IRS Designates Indian Tribal Governments to Be Treated as States for Certain Federal Tax Purposes

The IRS has issued Rev. Proc. 2008-55 to designate Indian tribal entities that appear on current or future lists of federally recognized Indian tribes—published annually by the Bureau of Indian Affairs of the Interior Department—will be treated as states for certain federal tax purposes.

For example, charitable contributions to or for the use of a tribal government may be deducted under federal income, gift, and estate tax laws; a tribal government is entitled to exemption from certain excise taxes; taxes imposed by a tribe may be deductible; and public activity bonds may be tax-exempt obligations. The IRS cautioned that a qualification as an Indian tribal government, however, does not necessarily establish that a tribe qualifies for a particular tax benefit.

Tribal entities not appearing on the Department of the Interior’s list can apply for a ruling from the IRS as to whether they may qualify as an Indian tribal government. The IRS will treat a tribe as an Indian tribal government if it has been acknowledged as a federally recognized Indian tribe as stated in a letter from the Interior Department.

For an electronic version of the revenue procedure: Rev. Proc. 2008-55

Rev. Proc. 2008-55 was published in Internal Revenue Bulletin 2008-39.

For more information, contact Rick Speizman, National Partner-In-Charge, KPMG’s Exempt Organizations Tax Practice (ExoTax), at (202) 533-3084 or rspeizma@kpmg.com

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