- 26 -
Whether the casino was located on tribal land (as respondent
contends) or on allotted land18 (as petitioners at times appear
to contend), the payments, constituting distributions to Tribe
members of profits from a casino owned and operated by the Tribe,
would be taxable to the Tribe members receiving them. If on
tribal land, they would be taxable on receipt. Choteau v.
Burnet, 283 U.S. 691 (1931); Anderson v. United States, 845 F.3d
206 (9th Cir. 1988); Fry v. United States, 557 F.2d 646 (9th Cir.
1977); Holt v. Commissioner, 364 F.2d 38 (8th Cir. 1966), affg.
44 T.C. 686 (1965). If on allotted land, they would be taxable
upon receipt because not "derived directly" from the allotted
land. See Squire v. Capoeman, 351 U.S. 1 (1956); Cross v.
Commissioner, 83 T.C. 561 (1984), affd. sub nom. Dillon v. United
States, 792 F.2d 849 (9th Cir. 1986); Hoptowit v. Commissioner,
78 T.C. 137 (1982); Critzer v. United States, 220 Ct. Cl. 43, 597
F.2d 708 (1979).
18 Under the General Allotment Act of 1887, ch. 119, 24
Stat. 388, as amended, Indians were allotted shares of
reservation land, held in trust on their behalf by the United
States. See Squire v. Capoeman, 351 U.S. 1, 3 (1956). Indians
holding such allotments could not alienate or encumber the
property without consent of the U.S. Government. Id. at 4.
Indians possessing such allotments were referred to as
"noncompetent" because of their inability to alienate or encumber
the land they held. Hoptowit v. Commissioner, 709 F.2d 564, 565
n.1 (9th Cir. 1983), affg. 78 T.C. 137 (1982).
In this case, the parties agree that the Oneida Tribe
purchased the land on which the casino was located from
noncompetent Tribe members in 1968. In respondent's view, the
land became tribal land upon this purchase, whereas petitioners,
though not clear on this point, appear to take the position that
the land retained its character as allotted land.
Page: Previous 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 NextLast modified: May 25, 2011