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Indian tribe distributions

ssoperator — Sun, 21 Mar 2021 19:16:32 GMT

My wife and son both receive a once-a-year distribution from their indian tribe, how would I report this?

Re: Indian tribe distributions

PattiF — Sun, 21 Mar 2021 19:28:29 GMT

To clarify this, what state do you live in and on what form, if any, is the distribution reported?

Re: Indian tribe distributions

ssoperator — Sun, 21 Mar 2021 19:43:55 GMT

We live in Oklahoma, but the tribe's reservation is in Red Lake, Minnesota. The payments were not recorded on any 1099 forms. They just received $500 checks, from the tribe's. The money comes from a yearly settlement the federal government pays to the tribe.

Re: Indian tribe distributions

PattiF — Sun, 21 Mar 2021 20:41:59 GMT

This is not counted as income.

Re: Indian tribe distributions

ssoperator — Sun, 21 Mar 2021 20:51:04 GMT

Ok, so I don't have to report it anywhere in TT?

Re: Indian tribe distributions

ssoperator — Sun, 21 Mar 2021 20:57:57 GMT

Also, he got a refund from his Tulsa Community College Bankmobile Vibe account of $28.53, and inheritance of a life insurance payout, from my wife's uncle (who lived on the same reservation) which was being held in a trust account until he was 18 (which he turned in 2020). I know the interest on this account is taxable and have already reported it, but what about the principal?

Re: Indian tribe distributions

PattiF — Sun, 21 Mar 2021 20:59:15 GMT

No, you so not have to report this anywhere in TurboTax.

Re: Indian tribe distributions

ToddL99 — Sun, 21 Mar 2021 21:16:57 GMT

The annual payments ($500) are probably not taxable. As proceeds from a settlement with the federal government, they are likely on account of harm (damages) done to the tribe and its members. Payments for damages are exempt from tax.

A "refund" is a return of your own money, not income. Unless he claimed the original payment as a business expense, he does not have to report the "refund" as income.

Life insurance proceeds (the principal) are not taxable and are not reported on a tax return.

Interest income from the trust holding those insurance proceeds is, as you are aware, taxable.

Re: Indian tribe distributions

ssoperator — Sun, 21 Mar 2021 22:44:51 GMT

Ok, thanks a lot!

Re: Indian tribe distributions

ssoperator — Sun, 21 Mar 2021 22:45:33 GMT

Ok, thank you very much!

Re: Indian tribe distributions

PattiF — Sun, 21 Mar 2021 22:54:09 GMT

You are welcome!