Is tribal per capita income considered taxable income?

[tasha7131]

I support my tribal boyfriend (who is married, but separated), but receives a tribal per capita quarterly. He does not work and earns $4500 per year in per capita. This is his only income. Can I claim him on my taxes? The only information I have found is if a person makes more than $4000 in TAXABLE income, they cannot be claimed.. but this is income that is claimed as a 1099-MISC.... Is he claimable? And no, he is not filing jointly with his ex, they are legally still married because they cannot afford divorce.

[MargaretL · Accepted solution]

Since he received 1099-MISC, it would indicate that the per capita income is income from Indian gaming proceeds and therefore it is taxable. Unfortunately, you will not be able to claim him on your taxes.

In general, the per capita payments issued to a member of Indian tribes are not subject to federal income tax, unless they are from gaming proceeds.

Per Irs: " If you are a member of a federally recognized tribe and have received income from tribal per capita distributions or from Indian gaming proceeds, here is some important information.

Reported on a 1099-MISC income statement, this income should be included on Line 21 of Form 1040, with a description. The correct description will allow the return to process as quickly as possible! For paper or e-file returns, please enter one of the following descriptions on Line 21:

Indian Gaming Proceeds
Indian Tribal Distrib
Native American Distrib"

[tasha7131]

Thank you for your help! I was searching for answers all morning. 🙂

[MargaretL]

My pleasure!

[Layled27]

Are there any scenarios for which a tribal member receiving per capita from gaming funds would be exempt from having to pay or be taxed on? 

[DianeW777]

No. Enter tribal distributions from Form 1099-MISC, Box 3 on Line 21, Form 1040 Schedule 1.  As indicated in a previous response the IRS shows the following information and a link is provided for your convenience.

• Include a description of the income in the space provided on Line 21.
• Use the correct description to make sure your tax return goes through processing without delays. For paper or e-file returns, please enter one of the following descriptions on Line 21:
  • INDIAN GAMING PROCEEDS
  • INDIAN TRIBAL DISTRIB
  • NATIVE AMERICAN DISTRIB
• Spell the descriptions exactly as listed above. For example, if you spell out distribution rather than using distrib, the IRS may reject your return and delay your refund.
  • Reporting Tribal Per Capita Distributions 

How to report Other Income on your tax return:

• To report this income you can use the following steps.  

1. Go to the Wages and Income  section of TurboTax
2. Scroll to  Less Common Income > Select  Miscellaneous Income, 1099-A, 1099-C
3. Select Other reportable Income > Enter a description (noted above) and the amount

[ShainaJ]

I get per capita payments and i file my taxes is that considered earned income and receive the credit? Also if I'm claiming my kids will i qualify any child credit? 

[ThomasM125]

The per capita income would not be considered earned income. You could only qualify for a child tax credit if you had over $2,500 in earned income.

@ShainaJ