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(B) Qualified Indian tribe.--For
purposes of subparagraph (A), an Indian tribe
is a qualified Indian tribe with respect to
an entity if such entity is engaged in a
fishing rights-related activity of such
tribe.
The "temporary deposit" of income exempt from tax under
section 7873 into a retirement account, argue petitioners, does
not change the character of the funds. Therefore, they conclude,
distributions that represent a return of originally tax exempt
funds are not subject to tax. Petitioners make no argument,
however, that interest accumulated in an account is exempt when
withdrawn.
Respondent argues that section 7873 was intended by Congress
to exempt from income tax only the wages of native people derived
from fishing-rights-related activity, that the payments into the
Guardian account were in addition to wages, that the source of
the payments into the Prudential account is unknown, and that
even if the source of the funds contributed to the retirement
accounts initially rendered them tax exempt, the distributions
from the accounts are not.
Respondent's determinations are generally presumed correct.
Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933).
Furthermore, every item of a person's gross income is subject to
Federal income tax unless there is a statute or some rule of law
that exempts the person or the item from gross income. HCSC-
Laundry v. United States, 450 U.S. 1, 5 (1981). Tax exemptions,
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