[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006.]
(a) 
It shall be the Tribal Policy of the Grand Traverse Band of Ottawa and Chippewa Indians (GTB, Tribe), acting as a government, to defend this chapter as a reasonable interpretation of the Tribe's governmental obligation to its members in interpreting 26 U.S.C. § 7873 consistent with existing federal law and the additional Tribal Constitutional obligation of the Tribal government to individual Tribal members to protect treaty rights to "fish, hunt, trap and gather food." GTB Constitution, Article X, Section 2.
[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006.]
(a) 
The purpose of this chapter is to state the public policy of the Tribe and to establish a method of implementing the Tribal public policy on the scope and application of 26 U.S.C. § 7873 for purposes of Tribal employees claiming the exemption via a percentage allocation made by the employee and verified by the GTB Human Resources Department.
(b) 
This Tribal statute is implemented pursuant to 25 U.S.C. § 476, (Tribal constitutional organization); 25 U.S.C. § 450 et seq. (as an act of Self-Governance); Article IV, Section 1(c) of the Tribal Constitution (powers of the Tribal Council to make laws); and Article XI, Section 2 of the Tribal Constitution (Land Use and Natural Resources Conservation Plans Required).
[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006.]
(a) 
This chapter shall apply to all Tribal members and members of other federally recognized who share in the treaty right established by Article 13 of the 1836 Treaty of Washington, 7 Stat. 491 (March 28, 1836). Further, the case law decision and the continuing Consent Decree in U.S. v. Michigan, 471 F. Supp. 192 (W.D. Mich. 1979), aff d as modified, 653 F.2d 277 (6th Cir. 1981), cert denied 454 U.S. 1124 (1981), controlling the Article 13 treaty right shall be used as interpretive authority to determine the scope of the application of 26 U.S.C. § 7873.
(b) 
The scope of this chapter is strictly limited to the Tribe acting in its capacity as a tribal government. This chapter is not intended to, and does not, create any enforceable rights against the Tribe as a government for monetary damages by Tribal members or third party rights against the Tribe for monetary damages.
[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006.]
(a) 
Statutory. 26 U.S.C. § 7873; S. Rep. No. 445, 100th Cong., 2nd Sess. (1988); H. Rep. No. 312 (part 2) 100th Cong., 2nd Session (1988); 25 U.S.C. § 7871; 25 U.S.C. § 476; and 25 U.S.C. § 450 et seq.
(b) 
Non-statutory. Notice 89-43, 1989-121.R.B. 80, Internal Revenue Manuel Handbook No. 4231 Section 533; U.S. v. Michigan, supra; Employment Tax Guide Indian Tribal Governments, Publication of IRS 1-877-829-5500 (ETGITG) (www.irs.gov/tribes last visited on April 18, 2006); FAQs regarding IRC Section 7873 (Fishing Rights) http://www.irs.gov/govt/tribes/article/0,,id=102508,00.html last visited on April 18, 2006); Hall v. Commissioner of Internal Revenue, T.C. Memo. 1998-336, 1998 WL 646609; Warbus v. Commissioner of Internal Revenue, 110 T.C. 279 (1998); "American Indian Law Meets the Internal Revenue Code: Warbus v. Commissioner," 74 N. D. L. Rev. 691 (1998); IRS Priv. Ltr. Rul. 200511006 (Nov. 23, 2004); IRS Tech. Adv. Mem. 9747004 (Jul. 25, 1997).
(c) 
For purposes of this chapter, the above authority shall control interpretations of all factual patterns that may arise in the implementation and application of this chapter by departments of the Tribe. Departments of the Tribe shall refer to the above authorities and shall consult with the Tribe's Legal Department as necessary or appropriate in implementing and applying this chapter.
[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006.]
(a) 
"Fishing rights-related activity" means any activity directly related to harvesting, processing, or transporting fish harvested in the exercise of a recognized fishing right of the Tribe, or to selling fish, if substantially all the harvesting was performed by members of the Tribe.
(b) 
"Income" means the weekly wages paid by the Tribe to an employee of the "Qualified Indian entity" under 26 U.S.C. § 7873.
(c) 
"Qualified Indian entity," means the Grand Traverse Band of Ottawa and Chippewa Indians acting as a governmental entity as stated in § 408 of this chapter.
(d) 
"Recognized fishing rights" means the Article 13 treaty right in the Treaty of Washington and recognized in U.S. v. Michigan, supra.
(e) 
"Tribe" means the Grand Traverse Band of Ottawa and Chippewa Indians.
[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006.]
26 U.S.C. § 7873(a)(1) provides an exemption from federal income tax on income, including wages, derived by members of the Tribe in the exercise of a fishing rights-related activity of the Tribe. 26 U.S.C. § 7873(a)(2) provides an exemption from federal employment taxes, including FICA taxes, on wages paid to members of the Tribe for services performed in a fishing rights-related activity of the Tribe.
[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006.]
"Fishing rights-related activity" includes any part of the physical acts of harvesting, processing, transporting, or selling fish.
(a) 
Persons eligible under this test include the following:
(1) 
Fishers, processors (including smoking), and transporters.
(2) 
Hatchery workers.
(b) 
Employees of the Tribe in the category denominated in this § 407 shall be eligible to make percentage allocation in support of the "directly related to" test and follow the procedure outlined in § 409 requiring consultation with the GTB Human Resources Department for purposes of claiming the exemption under the provisions of 26 U.S.C. § 7873.
[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006; and amended by Tribal Council in Special Session on October 29, 2008.]
"Fishing rights-related activity" also includes the Tribal governmental activities related to the overall structure of treaty-protected behavior that the Tribe, as a government, engages in to protect, manage, regulate and implement the treaty-protected fishing rights and from which Tribal members, or members of other Tribes under Article 13 of the 1836 Treaty of Washington, whether as Tribal governmental employees or Tribal Councilors, derive income. See: S. Rep. No. 100 at 475 (1988) ("In the case of...a qualified Indian entity, the bill exempts from income, social security, and other tax, only that income "derived" from fishing rights-related activities."). This is the "governmental and regulatory support" test for coverage of individuals involved in these activities.
(a) 
Persons eligible under this test include the following:
(1) 
Conservation officers.
(2) 
Environmental technicians.
(3) 
Fishers biologist.
(4) 
Fishers technicians.
(5) 
Fishery habitat policy analysts.
(6) 
Water quality biologist.
(7) 
Habitat inventory and assessment technician.
(8) 
Enforcement staff.
(9) 
Tribal Court personnel.
(10) 
Support staff, i.e., secretary, accounting, payroll.
(11) 
Legislative analyst.
(12) 
Information and education services.
(13) 
Data analyst.
(14) 
Policy analyst.
(15) 
Public information staff.
(16) 
Air/Water/Earth Quality Specialist.
(17) 
Natural Resources Department Manager (NRD).
(18) 
NRD Administrative Assistant/Program Director.
(b) 
In general for purposes of this chapter, eligible persons under this test include all employees of the qualified Indian entity/Tribe who participate in the following Tribal categorical governmental functions in support of "Treaty-related activities,..." includes the following:
(1) 
Regulatory/Legal Department.
(2) 
Conservation officers.
(3) 
Environmental services.
(4) 
Judicial Services.
(5) 
Tribal Council.
(A) 
Executive Functions.
(B) 
Legislative Functions.
(6) 
Natural Resources and Environmental Committee.
(7) 
Inter-Tribal Regulatory Bodies created at the direction of the Consent Decree (Chippewa Ottawa Resource Authority) or at the behest of intertribal initiatives.
(c) 
Employees of the Tribe in the category denominated in this § 408 shall be eligible to make percentage allocation in support of the "fishing rights-related activities" test and follow the procedure outlined in § 409 requiring consultation with the GTB Human Resources Department for purposes of claiming the exemption under the provisions of 26 U.S.C. § 7873.
[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006.]
(a) 
The GTB Human Resources Manager, in consultation with the GTB Natural Resources Department Manager, shall write a position description of all positions covered, directly or indirectly, by the reach of 26 U.S.C. § 7873 under the tests stated herein in §§ 407 and 408.
(b) 
The employee covered by the reach of 26 U.S.C. § 7873 and §§ 407 and 408 of this chapter shall have the option of concurring with the language of the position description, for the sole purpose of the application of 26 U.S.C. § 7873, or registering a non-concurrence.
(c) 
Each employee shall be required to file an employee allocation assertion made by the individual employee for those work duties covered by 26 U.S.C. § 7873 consistent with the Human Resources position description for his or her position.
(d) 
If the employee voluntarily concurs with the position description, such concurrence shall be deemed consent to an explicit allocation to be made by the GTB Human Resources Department, in consultation with the GTB Natural Resources Department and the GTB Legal Department, on the percentage of time eligible for an exemption under 26 U.S.C. § 7873.
(e) 
If the employee does not voluntarily concur with the position description and allocation made by the GTB Human Resources Department, then the GTB Accounting Department shall treat the position as subject to federal income taxation and federal withholding of FICA and FUTA. The GTB Accounting Department shall then issue tax forms consistent with IRS Notice 89-34 for the individual employee to file an independent claim of exemption under 26 U.S.C. § 7873.
(f) 
The GTB Human Resources Department shall verify the employee allocation solely for the purpose of compliance with the verification requirements of 26 U.S.C. § 7873(c)(1); as interpreted by the IRS in Internal Revenue Manual Handbook No. 4231 § 553(3)(d) ("Verification of time allocated... His employer should verify the percentage of time he engages in fishing rights-related activities of his tribe. The employer should also indicate that the employer is maintaining records to support the allocation.")
[History: Tribal Act #06-24.1651, enacted by Tribal Council on April 26, 2006.]
(a) 
The GTB Accounting Department shall maintain records consistent with this chapter.