§7873 Income Derived by Indians From Exercise of Fishing Rights

Summary

Income that a tribal member or a qualified Indian entity earns from exercising a tribe's recognized fishing rights is free from federal income tax. Wages paid to a tribal member for work in the tribe's fishing rights activity, by another member or by a qualified Indian entity, are also free from federal employment taxes. Covered work means harvesting, processing, transporting, or selling fish caught under fishing rights secured as of March 17, 1988, by treaty, executive order, or act of Congress, as long as tribe members did substantially all the harvesting. A qualified Indian entity must be owned entirely by tribes, tribal members, or their spouses, and tribal members must handle substantially all of its management. If it does substantial processing or transporting, at least 90 percent of its gross receipts must come from fishing rights activities of tribes that each own at least 10 percent of the entity. Payouts from such an entity to tribal members keep the tax-free treatment to the extent they come from fishing rights income.