Do I have to pay state tax if I am a Native American Indian Living and Working on my federally recognized reservation. Where do I claim this on my tax return?

[HelenC12]

Native Americans living and working on a reservation are allowed to exempt their (reservation) W-2 wages from Arizona state taxation, under Arizona state law. TurboTax supports this exemption, and here are the instructions to enter.

1. Finish your federal tax return, as your reservation wages are still taxable by the federal government
2. Begin your Arizona state tax return 
3. When you reach the screen with a list of items that has the title "Do These Apply to You?"   check the one that is labeled "I Have Adjustments to Federal Income."
4. Continue until you reach  "Any Income Adjustments"
5.  Scroll down and select  "I Am a Native America Who Earned Wages While Living and Working on a Reservation"
6. Click Continue and on the very next screen you should have the option to enter the dollar amount of your wages that are eligible for the Arizona exclusion.

Source: TeresaM

[JF1300]

Hello, I’m new at filing my own taxes,. So I was wondering how would I fill out/what would I put down for the Tribal Member MT tax exempt? I am a Tribal Member that lives on the reservation here in Montana

[PattiF]

The Montana Department of Revenue has two categories for Tribal members. Income is exempt from Montana income tax if all of the following requirements are met:

• You are an enrolled tribal member of the governing tribe of a reservation;
• You resided and worked on that reservation; and
• You earned income by working on that reservation.

If the three conditions above are met, no tax return is needed. Send in this form by mail.

If money was earned off the reservation and meets the income threshold, a Montana income tax return will be required. The details of who needs to file a form are under the instructions for Line 2 in the above form.

[shirlgrl]

I live in the state of Michigan I am also native American. I cannot find the box to ask me the question about native American. Yes my tribe is listed!

[ErnieS0]

The Michigan section of TurboTax includes a section to adjust your income if you are a Resident Tribal Member and to claim the sales tax credit @shirlgrl.

1. In the Michigan section, go to Here's the income that Michigan handles differently.
2. Under Miscellaneous select Tribal Income
3. Once you're completed that section, continue to Take a look at Michigan credits and taxes
4. Under Other Credits select Tribal Member Sales Tax Credit

For more info on Michigan Tribal Income see Frequently Asked Questions

[dereknewmexico]

Need help. 
I am Native American living and working on my reservation. We have to pay (forced) rent through the school I work at; can this be recorded as a deduction in my taxes? Where does it need to be entered? Is this different than the form 8845? 

[Vanessa A]

Form 8845 is for Employers of American Indians, not employees.

If you are an employee, there is not a deduction for rent, whether or not it is required by the employer. Income Tax Guide for Native American Individuals and Sole Proprietors

Whether or not you have to pay state taxes and how much you may have to pay, depends on the state in which you live.  

[dereknewmexico]

Again (I am Native American), the rent I pay is forced because property on reservation land cannot be purchased. The allotment of land is based on families. Therefore, where I work on the reservation is forced. I  cannot deduct this rent cost (even though I can prove how much was paid)? 

[Vanessa A]

No, even if you are Native American, if you are an employee, there is not a special deduction for housing costs on the reservation whether or not you are forced to live there in order to do the job you are doing or not. 

The only way your rent would be deductible is if you were self-employed and traveling from your tax home more than 50 miles away to stay on the reservation for your self-employed position. 

[Junior576243]

Mississippi 

[ErnieS0]

No. You do not have to pay Mississippi state income tax if you are a Native American Indian living and working on your federally recognized reservation. 

Mississippi says: “A Native American living and working on an Indian Reservation in Mississippi is exempted from Mississippi Income Tax on the income earned on the reservation.”

Your employer should not have withheld state income tax. If they did, speak with your employer to see if they can correct your W-2.

Fill out and give your employer a Form 80-340 to claim an exemption from future withholding.

If you cannot get a corrected W-2, you can add a negative adjustment on your Mississippi return. On the screen Enter Any Other Income and Losses, enter your tribal wages as a negative number.

See: Withholding Tax FAQs

@Junior576243

[Willbc]

So what amount of wages do I enter? Like if my total wages is 20,000. Do I enter the whole 20,000 or nothing

[BillM223]

You enter your total wages on the federal return. It is on the state return (i.e., during the interview for your state return) that you indicate that you qualify for the exemption as a Native American and how much should be exempted.

@Willbc 

[Willbc]

That did not answer my question. So if I make 20,000 a year, do I enter 20,000 in the box or 0? Because I live and work for my tribe in Arizona.

[BillM223]

OK, what box are you talking about? I had assumed that you meant on your W-2.

If you meant some box in your state interview, what box you are referring.