Cross v. Commissioner
United States Tax Court
Petitioners, members of the Puyallup Indian Nation, operate a smokeshop on land held in trust by the United States under the provisions of the Medicine Creek Treaty of 1854 and the General Allotment Act of 1887. Held, income derived from the smokeshop is taxable because it is neither "directly derived" from the underlying trust land, nor expressly exempted from taxation by any statute or treaty.
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Petitioners, members of the Puyallup Indian Nation, operate a smokeshop on land held in trust by the United States under the provisions of the Medicine Creek Treaty of 1854 and the General Allotment Act of 1887. Held, income derived from the smokeshop is taxable because it is neither "directly derived" from the underlying trust land, nor expressly exempted from taxation by any statute or treaty. Held, further, smokeshop income allocable to the fair rental value of the unimproved land upon which the smokeshop sits is not income "directly derived" from the trust land within the meaning of…
1DissentParker, J.
I have no quarrel with our prior Indian smokeshop cases and I agree that they are dispositive of the principal issue in this case.1 However, none of those cases addressed the issue of whether rental income from restricted, allotted land (hereinafter trust land) or some portion of the smokeshop income allocable to the land itself is income "derived directly” from the trust land within the meaning of Squire v. Capoeman, 351 U.S. 1 (1956), and thus exempt from tax in the hands of the individual Indian allottee.2 I think rental income to the Indian allottee or the portion of his smokeshop income…
2Cases cited21 opinions
- Pollock v. Farmers' Loan & Trust Co.Supreme Court of the United States · 1895
- Pollock v. Farmers' Loan & Trust Co.Supreme Court of the United States · 1895
- Squire v. CapoemanSupreme Court of the United States · 1956
- Superintendent of Five Civilized Tribes v. CommissionerSupreme Court of the United States · 1935
- Curphey v. CommissionerUnited States Tax Court · 1980
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