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LUMMI INDIAN NATIONTITLE 42- FOREIGN TAX CODE -

Statement of Sovereign Relationship: The Lummi Nation has a nation-to-nation relationship 

with the United States established by a peace treaty (Treaty of Point Elliot, 12 Stat. 927, 1855 

Negotiated, Ratified & Proclaimed in 1859). The Lummi Nation proclaims it’s inherent 

sovereignty is intact; although, under duress from the US Termination Policy and attempts to 

“Kill the Indian to Save the Man” policy & programs, it has ratified a “Lummi Constitution” to 

guide its exercise of modern self-determination and self-governance. The Lummi Nation claims 

the U.S. Constitution was written in such fashion as to assure “’Tribal Indians” were not a part 

of “We the People of the United States” and would not be taxed or represented by the US 

Government (Art. I, Sec. 2, Cl. 3 and 14th Amendment). The Indian Nations were not a part of 

the United States system of government, and this is why the US entered treaties with the tribes 

(Art. II, Sec. 2, Cl. 2; See: Kapplers, Volume II). Once the Senate ratified and the President 

proclaimed the treaty-made then it became a part of the “Supreme Law of the Land” (Art. VI, 

Sec. 2). Disputes over the treaties-made could be reviewed by the Supreme Court (Art. III, Sec. 

2, Cl. 1). The US Congress could regulate commerce with the tribes as delegated by the

Commerce Clause (Art. I, Sec. 8, Cl. 3). Individual states could not enter treaties with the tribes 

(Art. I, Sec. 10, Cl. 1 and Reconstruction Debates of 39th & 40th US Congresses) or govern 

commerce with the tribes (Dormancy Aspect of Indian Commerce Clause). To join the Union on 

an Equal Footing (See: NW Ordinance 1787, and History of Article IV US Constitution), the states 

disclaimed jurisdiction over Indian Affairs (by territorial act or constitutional article). The State 

of Washington included this “Disclaimer” in its constitution as Article XXVI- Disclaimer.

Federal and state powers to enter Indian Country for purposes of taxation has resulted from 

decisions that came from the Tax Courts, and supported by the Supreme Court, mainly since 

1956. Primary examples of damaging decisions are- Squire (1956) as regards federal taxation,

and Cotton Petroleum (1989) as regards state taxation. Taxation of Tribal Indians are resultant 

from the 1924 Indian Citizenship Act (contrary to constitutional intent, See: Elk v. Wilkins, 1884, 

as well as language inserted in the citizenship act itself). The Department of Interior’s Solicitor’s 

Opinion (1940) on “Excluding Indians not Taxed” also weakened tribal rights and protections 

against taxation. This opinion concluded that there are no more “Excluding Indians not taxed”

in existence (however, there are over 565 Federally Recognized Tribes today with an estimated 

three million tribal Indian members). This “Opinion” meant there were no more “Tribal 
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Indians” protected or excluded from taxation by language of the Constitution- even though the 

constitution was not amended for this. In fact, the 14th Amendment was worded to prevent this 

very conflict. The Lummi Nation believes the taxation campaign waged by the IRS against Indian 

Country, and tribal Indians, is unconstitutional. Until we prevail in a constitutional challenge, 

this “Foreign Tax Code” is hereby enacted by the Lummi Nation.

In addition, the State of Washington had attempted to comply with the federal authorizations 

for specific types of assumption of jurisdiction inside the boundaries of the Lummi Reservation -

under the authority of Public Law 280. This act provided authorization for the state to assume 

jurisdiction over mandatory school attendance, juveniles, and traffic type of offenses. It has, 

today, limited authorization. This law required the individual states, before assuming this type 

of jurisdictional authority, to amend either the organic laws of the original territory that 

proclaimed it did not have jurisdiction over Indians and Indian Affairs, or to amend the state 

constitution- if the “Disclaimer” was included therein. Washington State assumed claims to 

jurisdiction over Lummi Tribal Indians and the Lummi Reservation without compliance with the 

amendment requirement, and Article XXVI of the Washington State Constitution is still legally 

binding on the state. The Supreme Court has ruled that it is a “matter of state” law for 

enforcement of the state constitutional amendment matter. The Lummi Nation has always 

denied the State of Washington has lawfully assumed jurisdiction over the Lummi Reservation 

and People. However, the state governor, the state legislature, and the state supreme court 

have not fallen into compliance with the state constitution and it will require a major lawsuit of 

“We the People of the State of Washington” to force compliance. This may be partially avoided 

if the State seeks Retrocession of PL 280 Jurisdiction over the Lummi Reservation as authorized 

by the amended federal law. This retrocession is not done solely upon the request of the tribe.

However, it is the position of the Lummi Nation that the State of Washington has never had the 

legal authority to exercise taxation jurisdiction inside the boundaries of the Lummi Reservation 

and any such authority exercised is based on legal fictions created by the courts and not by Acts 

of Congress, US constitutional amendment, state constitutional amendment, or treaties-made.

The State of Washington has entered into Tobacco and Fuel “Compacts” with the Washington 

Tribes, including the Lummi Nation, and as a result of the legal fictions created by the U.S. 

Supreme Court. Under duress the tribes had agreed to enter such compacts. However, such 

compacts are constitutionally (national constitution) limited in the negative to the states unless 

approved by Congress (Article I, Section 10, Cl.1). Such limited congressionally authorized

tribal/state compacts were authorized (under Article I, Section 10, Clause 1) for gaming 

purposes only, in the Indian Gaming Regulatory Act (1988). This placed tribes at the level of 

“states” for the purposes of compacts. 
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The Lummi Nation believes the State of Washington, and the United States, are both 

constitutionally liable for unconstitutional taxation of Indian revenues, gross income, and 

commerce or trade inside Indian Country. 

CHAPTER 42.1. - “TRIBAL GENERAL WELFARE EXCLUSIONS CODE”- PER TITLE 26 U.S. 

INTERNAL REVENUE CODE SECTION 139E

Chapter/Subchapter/Section 

42.1..010 General

1. Purpose

2. Background and Intent

3. Definitions

42.1.100 Ratification of Prior Acts: Intent of Legislation

42.1.1 10 General Welfare Doctrine; Rules of Construction

42.1.120 Non-Resources Designation

42.1.130 Federal Trust Obligations; Executive Orders

42.1.200 Indian General Welfare Benefits (Code Section 139E)

42.1.201 Safe Harbor Programs

42.1.202 Programs Meeting the General Test

42.1.203 Purpose

42.1.204 Eligibility and Application Procedures

42.1.205 Limited Use of Assistance; Substantiation

42.1.300 Limitation on Payments; Annual Budgeting

42.1.400 Forfeiture of General Welfare Assistance
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42.1.500 Programs not Limited to Means Testing

42.1.501 Privacy; Information Sharing

42.1.502 Government-to-Government Relationship; Executive Order 13175

42.1.503 Other Tax Exclusions or Exemptions

14

42.1.600 Governing Law

42.1.700 Severability

LUMMI INDIAN NATION GENERAL WELFARE EXCLUSIONS CODE

42.1.010 General.

This code shall be know n as the Lummi Indian Nation General Welfare Exclusions Code

(1) Purpose- The first purpose of this code is to memorialize the procedures used by the

Lummi Nation to determine what services or programs are needed to promote public 

health, safety and other basic need service(s) for the promotion of the general welfare 

of the Nation – such as but not all inclusive, sewer, water, electrical service/power, 

infrastructure, housing, public sanitation services, public education and other such 

functions that support the long historical, social, and cultural general welfare of the 

Nation. The second purpose of this code is to establish basic guidelines and procedures 

for programs to follow in ensuring compliance with the general welfare exclusions

doctrine and Internal Revenue Code Section 139E. In addition, it is intended herein to 

provide guidance and definition to what is composed of “Ceremonial Activity” as 

included in the Act of 2014.

A. The primary purpose is to assure that General Welfare Benefits that are 

excluded from “Gross Incomes” by the Tribal General Welfare Exclusions Act 

of 2014 are readily and easily provided to the qualified tribal members, and 

their spouses and dependents, and are delivered through qualified tribal 

programs and departments and are broad enough benefits and services to 

help tribal members overcome the burdens of financial and social hardship;

B. The secondary purpose is to assure that the application of the “Ceremonial 

Activity” Exclusions provided for within the Tribal General Welfare Exclusions 

Act of 2014 are large enough in scope to assure that ceremonial activity is 

not taxed by the United States under allegations it is includable under “Gross 
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Income” of Section 61 Internal Revenue Code of the United States. The 2014 

Act excluded such activities from taxation, and it is herein partially defined by 

the Nation as to what is excludable.

(2) Background and Intent - 

The Lummi Nation is a federally recognized tribe. It purposely chooses to exercise its 

inherent rights of sovereignty to promote & protect the general welfare of the Nation, 

exercise its self-determination and self-government, to assure protection & preservation 

of traditional culture & traditional knowledge, and guarantee the preservation and 

practice of ceremonial activities amongst its individual members and within the tribal 

collective, and guarantee the transmission of its traditions & customs to the next 

generations, by providing general welfare assistance and protection of “Ceremonial 

Activity” as included in the Tribal General Welfare Exclusions Act of 2014, as recognized 

in Title 26 U.S. Internal Revenue Code Section 139E. 

Both the United States Congress, through its enactment of the Tribal General Welfare 

Exclusion Act of 2014, and the U.S. Internal Revenue Service, through its traditional 

application of the general welfare doctrine, have recognized the sovereign right of 

Indian Tribal Governments to provide financial assistance to individuals under certain 

circumstances on a non-taxable basis-services and benefits otherwise excluded from 

taxation by the Act of 2014. 

This code is intended to affirm the Lummi Nation’s inherent sovereign right to promote 

the general welfare of the tribe and provide qualifying assistance and program 

benefit(s) on a tax free, tax exclusion basis. In this light, the 2014 Act excludes “welfare 

benefits” and “ceremonial activity” from the definition of “Gross Income” and therefore 

not included as taxable activity. In this regard, the Constitution of the Lummi Nation 

confirms the sovereign duty and responsibility of the Lummi Nation to maintain the 

culture and independence of its members, to encourage the economic well-being of its 

members, and to promote the rights of its members, elevate their common welfare, and 

protect their cultural heritage and ceremonial health. The Assistance authorized by this 

code is intended to qualify individuals, groups of qualified members or qualified nonmember Indians for tax free treatment to the fullest extent permitted by applicable

law. Without limitations, the following benefits shall be treated as non-taxable activity 

excluded from the definition of “Gross Income” hereunder: 

(a) Benefits that satisfy the requirements for exclusion under Title 26 U.S. IRC 

Section 139E;
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(b) Benefits that are provided under an IRS Safe Harbor Program;

(c) Benefits that qualify for exclusion under the IRS General Welfare Test; or

(d) Benefits that meet another express exclusion or exemption under Title 26

U.S. Internal Revenue Code, such as the exclusions provided tribal medical 

expenses under IRC Section 139D, or that meet other recognized exemptions

or exclusions including, for example, resource or land-based exemptions 

under 25 U.S.C. Section 117a-b, 1407 and 1408.

(e) Benefits of tribal support for, but not interference within, “Ceremonial 

Activities” common to the traditional culture and spiritual practices of the 

indigenous peoples, in this case the Lummi Nation.

(3) Definitions In construing the provisions of this code, the following words and phrases 

shall have the meaning designated in this section unless a different meaning is expressly 

provided or the context provides otherwise.

(a) “Assistance” Any Program benefits or payments that qualify for tax free 

treatment under the Tribal General Welfare Exclusions Act of 2014,

(b) “Benefits” Any persons or persons entitled to receive Assistance in 

accordance with specific Program Guidelines. Programs designated to qualify 

for exclusion under Title 26 U.S. Code Section 139E may benefit Members, 

spouses of Members, and /or Dependents of a Member. Programs designed 

to meet the Safe Harbors may benefit any Member or Qualified Nonmember.

(c) “Code” means the Title 26 U.S. Internal Revenue Code of 1986, as amended.

(d) “Compensation” for services should reflect that qualifying Programs are not 

disguised employment. However, this shall not prevent the Nation from 

structuring Programs with community service ties so long as such ties are 

consistent with the Tribal General Welfare Exclusions Act of 2014. For 

example, Programs similar to the Workforce Investment Act may include tax 

free Assistance.

(e) “Constitution” means the Constitution of the Lummi Nation.

(f) “Disability” or “Disabled” – The term disability or disabled as used for 

purposes of Programs covered by this code shall refer to the inability of an 

individual to care for himself/herself due to physical or mental limitations 

and shall be determined in accordance with tribal law.

(g) “Dependent” – The term “Dependent,” for purposes of Title 26 U.S. IRC 

Section 139E, has the meaning given such term by U.S. IRC Code Section 152, 

determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B). 
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(h) “Tribal General Welfare Exclusion”- Assistance to tribal members or 

otherwise qualified persons shall be treated as excluded from taxation, so 

long as it satisfies the requirements for exclusions under Title 26 U.S. IRC 

Section 139E, as may be provided under a Safe Harbor Program, or it meets 

the General Test. 

(i) “General Test” – Assistance will be treated as meeting the General Test 

under the Tribal General Welfare Exclusion Act of 2014 if the benefits are: (1) 

paid by or on behalf of an Indian Tribe, (2) under a social benefit program, (3) 

based on either needs of the Indian Community itself or upon individual 

needs of the recipient (which need not be financial in nature), and (4) are 

not Compensation for services or per capita payments.

(j) “Lavish” or “Extravagant” – Except as otherwise required for compliance 

with final guidance issued under Title 26 U.S. IRC Section 139E following 

consultation, “Lavish and Extravagant” shall be determined by the Tribal 

Council in its sole discretion based on all facts and circumstances, taking into 

account needs unique to the Tribe as well as the social purpose being served 

by the particular Assistance at hand. [Note: Based on preliminary research, 

Poverty level income is at $24,600 for a family of four, adding $4320 for each 

additional person. Median Income is at about $57,000 annual net for family of four. 

Mean Income is about $72,641 annual net for family of four. Moderate Income is

about $95,000 annual net for family of four. Court case (2018) of “Sally Jim”

(Miccosukee Tribe)ruled that $272,000 is “lavish or extravagant.” 

(k) “Member” - The term “Member” shall mean enrolled members of the Tribe 

and such other individuals who may be treated as members for Assistance as 

determined by the Tribal Council in accordance with the laws, customs,

culture and traditions of the Tribe. Spouses and dependents of Enrolled 

Tribal members shall be treated the same as the qualified tribal member 

provided all parties are still members of the same household unit, or the 

spouse and relevant dependents are covered by a court order holding the 

missing spouse responsible for care and assistance.

(l) “Code” means the Tribal General Welfare Exclusions Code.

(m) “Pay” or “paid” or “payment” means pay or reimburse in whole or in part.

(n) “Program” or “Approved Program” means any program established by or 

under authority of the Tribal Council, including any program authorized 

through the annual budget process, to provide Assistance hereunder. A 

program shall not fail to be treated as an Indian tribal government Program

solely by reason of the Program being established by tribal custom or 

government practice.
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(o) “Promotion of the general welfare” or “Social benefit” should reflect a goal 

or goals established by and in the sole discretion of the Tribal Council for the 

promotion of the general welfare of the Tribe, for example, in furtherance of

tribal self-determination/self-government, socio-economic improvement, 

education and training, and ceremonial/cultural/traditional health.

(p) “ Qualified Nonmember” means a spouse, former spouse, legally recognized 

domestic partner or former domestic partner, ancestor, descendant, or

Dependent of a member of the Tribe. Individual Tribal Programs may, but are 

not required to, cover Qualified Non-members.

(q) “Reservation” means the reservation of the Lummi Nation or, if the context

so permit, any other Indian reservation as defined in U.S. Internal Revenue 

Code Section l62(j).

(r) “Safe Harbor Program” shall refer to a Program that meets the safe harbor 

requirements set forth herein and IRS Revenue Procedure 2014-35, as the 

same may hereafter be amended. Need shall be presumed for Assistance

provided under a Safe Harbor Program. Further clarification shall apply once 

IRS/Tribal Consultations are finalized or otherwise challenged before 

Congress.

(s) “Service area” has the same meaning as in USC 25 C.F.R. Section 20.100.

(t) “Service unit area” means an area designated for purposes of administration 

of Indian Health Service programs under USC 42 C.F.R. Section l36.21(l).

(u) “Self-determination” should be construed broadly to reflect traditional 

health, education and welfare programs as well as unique cultural and

traditional based programs and economic development. See, e.g., PLR

199924026 (tax free business grants in part to promote on reservation

employment).

(v) “Spouse” and “Dependents” shall be determined in accordance with Tribal 

laws, customs and traditions.

(w) “Tribal Council” or “Council” means the Lummi Indian Business Council.

(x) “Ceremonial Activities” are those activities common to traditional cultural 

and spiritual practices of the tribal and intertribal social collectives, as 

intentionally excluded from federal taxation by the Act of 2014.

42.1.100 Ratification of Prior Acts; Intent of Legislation. This code does not establish a 

new program or programs. This code is intended to memorialize and confirm existing

procedures used in the administration of tribal general welfare assistance programs and 

services and is not to be construed as the creation of new general welfare assistance rights that 

previously did not exist. Assistance provided prior to the enactment of this code is hereby

ratified and confirmed as tribal general welfare assistance pursuantto the authority of the 
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Tribal Constitution. It is intended to establish a framework to improve the coordination of 

general welfare doctrine compliance and to provide protection of tribal Beneficiaries that have 

received such services or benefits. Programs and services referred to herein must be authorized 

by independent action of the Council or its designees. It is, further more, not the intent of this 

code to create new, modern tribal governmental control over “traditional knowledge 

transmission through ceremonial activities.” Any “ceremonial activities” mentioned herein is 

only for the purpose of clarifying what is excluded from federal taxation.

42.1.110 Tribal General Welfare Doctrine; Rules of Construction. The U.S. Internal 

Revenue Service has historically recognized that payments by a Tribal government to Tribal 

Members under a legislatively provided social benefit program for the promotion of the general 

welfare of the Tribe are excludable from the gross income of those Tribal Members who receive 

said payments. On December 5, 2011, the United States Treasury Department and IRS 

published Notice 2011-94 as part of an initiative to conduct consultation on ways to improve 

guidance on tribal general welfare matters. Notice 2011-94 invited comments from tribal 

governments concerning the application of the general welfare exclusion to Indian tribal 

government programs. The Tribe participated in that process through comments and supported 

similar efforts by the National Congress of American Indians, the United South and Eastern 

Tribes, Inc., the California Association of Tribal Government and the Affiliated Tribes of the 

Northwest Indians, all seeking clarity with regard to the sovereign right of tribes to provide tax 

free assistance based on non-financial need criteria including the preservation of tribal culture 

and tradition.

On December 5, 2012, the IRS and Treasury Department issued Notice 2012-75 proposing new 

guidance and providing interim relief under the general welfare exclusion for Programs that 

meet designated safe harbor rules. The Tribe asserted all protections provided under the 

proposed rule and made certain operational changes to Programs where possible to secure 

additional Member protections under the interim relief. On June 3, 2014, the U.S. Treasury

Department issued formal guidance in the form of Revenue Procedure 2014-35 confirming that

the IRS will not tax Member Assistance that meets designated IRS safe harbor requirements.

In September of 2014, tribes and tribal organizations worked with the United States Congress 

to clarify that Bills then pending in the House (H.R. 3043) and in the Senate (S.B. 1507) were in 

fact intended to expand tribal general welfare exclusion rights and build upon the safe harbor 

and general test relief previously recognized by the IRS. On September 17, 2014, Senators 

Moran and Heitkamp, co-sponsors of S.B. 1507, engaged in a colloquy with the Chairman of the 

Senate Finance Committee, Senator Wyden, on the Congressional Record of the Senate 

confirming their understanding and intent that:
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1. IRS would apply S.B. 1507 “no less favorable than the safe harbor approach provided 

for in Revenue Procedure 2014-35, and that in no event will IRS require an individualized 

determination of financial need where a tribal Program meets all other requirements of 

new section 139E as added by the bill.”

2. The bill requires that “any ambiguities in new Code section 139E shall be resolved by 

the IRS in favor of Indian Tribal governments and deference shall be given to Indian 

Tribal governments for programs administered and authorized by the Tribe to benefit

the general welfare of the Tribal community.”

3. It “would be contrary to the intent of Congress” if the IRS were to “take the occasion 

of passage of H.R. 3043 or S. 1507 to retrench, narrow or possibly withdraw the 

administrative guidance provided in Rev. Prc. 2014-35 after enactment of the bill.”

4. The Congressional intent “is to expand rather than restrict the safe harbor provisions 

in Rev. Proc. 2014-35.”

5. “The purpose of this legislation is to further empower Tribal self-determination.”

6. “Tribal governments have a long history of providing critical benefits to Tribal 

Members, and these programs are fundamental to the sovereignty and cultural integrity 

of tribes. Tribes, and not the IRS, are in the best position to determine the needs of their 

members and provide for the general welfare of their tribal citizens and communities.”

On September 18, 2014, the Tribal General Welfare Exclusion Act of 2014 passed both houses 

of Congress, and was signed into law on September 29, 2014. The Tribal Council now expressly 

embraces the forgoing principles as an integral part of this code and as guiding principles in 

construing the Tribe’s compliance with Code Section 139E, the Safe Harbor Rules, and the 

General Test.

The assistance payments and services authorized by this Ordinance are intended to qualify for 

favorable tax treatment under the general welfare doctrine to the fullest extent permitted by 

law and shall be construed accordingly.

42.1.120 Non-Resource Designation. General welfare services and payments

hereunder are paid from assets of Tribal government; all payments are based on budget

availability of the Tribal government, and the Tribal government does not guarantee any

payments hereunder. Benefits paid hereunder on the basis of need shall not be treated as a 

resource of the Member for any purpose. The Council reserves the right to cancel, adjust, 

modify or revoke any benefits that are treated as a resource of the Tribal Member. The socio-
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economic sufferance of qualified tribal members and their spouses or dependents mandates

tribal assistance when said qualified persons are below recognized thresholds that limit their 

qualification for tribally funded assistance, such as the “Lavish and Extravagant” Ruling in the 

Sally Jim Case (2018)- provided such assistance that exceeds federal program funding limits are 

otherwise covered by tribal hard dollar accounts.

42.1.130 Federal Trust Obligations; Executive Orders. The Tribe reserves the right 

to provide Assistance including circumstances where federal funding is insufficient to operate 

federal programs designed to benefit Tribal Members, their spouses or dependents, and when 

federal funding is insufficientto adequately and consistently fulfill federal trust obligations. The

Tribe’s adoption of Approved Programs is not intended to relieve or diminish the federal

government of its funding obligations and trust responsibilities. Nothing herein shall waive the

Tribe’s right to seek funding shortfalls or to enforce the trust rights of the Tribe and its

members. The Tribe shall be entitled to government-to-government consultation and

coordination rights in regard to this Ordinance, in it’s quest to secure such federal funds. Such 

additional tribal assistance, added to otherwise qualified status under externally funded 

programs shall not be damaged by disclosure of financial assistance or contributions made by 

the tribe that is otherwise qualified as not included under “gross income” of the qualified 

member applying for tribal hard dollar assistance under this code.

42.1.200 Indian General Welfare Benefits(Code Section 139E). Programs that meet 

the following criteria for Exclusion under Code Section 139E shall be treated as non-taxable 

Assistance under the General Welfare Exclusions Act of 2014 (law) without the applicant having 

to demonstrate individual need.

(1) General Criteria for Qualification under Code Section 139E: Each payment made or 

service provided to or on behalf of a Member (or any Spouse or Dependent of

the Member) pursuant to a Program under this Ordinance shall be treated as nontaxable Assistance under the General Welfare Exclusions Act (law) so long as the 

following criteria are met:

(a) The Program is administered under specified guidelines and does not discriminate in 

favor of the members of the governing body of the Tribe;

(b) Program benefits are available to any Tribal Member who meets such guidelines;

(c) Program benefits are for the “promotion of the general welfare”;

(d) Program benefits are not Lavish or Extravagant; and

(e) Program benefits are not Compensation for services.
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(2) Ceremonial Activities: Any items or activity of traditional cultural significance and 

purpose, reimbursement of costs, or transmission of cash honorarium for participation 

in cultural or ceremonial activities for the transmission of traditional tribal culture and 

ceremonial knowledge shall not be treated as Compensation for services.

Caveat: It is not the intent of the Lummi Nation to limit the “exclusion” 

protection for “Ceremonial Activities” included in the Act of 2014 and made law (Title 

26, U.S. Internal Revenue Code, Section 139E) to only tribally managed programs. The 

Lummi Nation recognizes the “individual aspects” of preservation of traditional 

ceremonial activities and recognizes that the tribal and federal law is intended to 

protect all “ceremonial activities” from federal taxation (tribal and tribal member 

activity).

(3) Special Effective Dates: Code Section 139E is effective for Assistance in taxable years 

for which the period of limitations on a refund or credit under U.S. IRC Section 6511 has 

not expired. If the period of limitation on a refund or credit resulting from the 

application of Code Section 139E (a) would otherwise expire before the one-year period 

beginning on the date of the enactment of Code Section 139E, a refund or credit (to the 

extent attributed thereto) may be made or allowed if a claim is filed before the close of 

such one-year period.

42.1.201 Safe Harbor Programs. Programs that meet the following general criteria 

for safe harbor treatment, and provide qualifying safe harbor benefits, shall be treated as nontaxable Assistance under the General Welfare Exclusion Act (law) without the applicant having 

to demonstrate individual need:

(1) General Criteria for Safe Harbor Treatment: Each Safe Harbor Program shall 

satisfy the following general criteria:

(a) The benefit is provided under a specific Approved Program of the Tribe.

(b) The Program has written guidelines specifying how individuals may qualify for the

benefit.

(c) The benefit is available to any tribal member, Qualified Non-member, or identified 

group of Tribal Members or Qualified Non-members who satisfy the Program guidelines, 

subject to budgetary restraints.

(d) The distribution of benefits from the Program does not discriminate in favor of the 

governing body of the Tribe.

(e) The benefit is not Compensation for services; and
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(f) The benefit is not Lavish or Extravagant under the facts and circumstances.

(g) The benefit of exclusions extended to “Ceremonial Activities” by tribal and federal 

law is purposely extended to the tribal contributions made through tribally authorized 

programs as well as intentionally extended to any and all “ceremonial activities” 

practiced by the traditionalistic individuals and subparts of the social collective active 

with the tribal and intertribal societies practicing such activities of the Lummi Nation.

(2) Qualifying Safe Harbor Benefits: The following benefits may be provided

under a Safe Harbor Program. The benefits listed in the parenthetical language herein 

are illustrative only, rather than an exhaustive list. Thus, a benefit may qualify for 

exclusion from gross income as a Safe Harbor Program even though the benefit is not 

expressly described in the parenthetical language herein, provided that it meets all 

other requirements of Article VI and Revenue Procedure 2014-35 (as may be amended):

(a) Housing programs. Programs relating to principal residences and ancillary 

structures that are not used in any trade or business, or for investment purposes that--

* Pay mortgage payments, down payments, or rent payments (including but not 

limited to security deposits) for principal residences;

* Enhance habitability of housing, such as by remedying water, sewage, or 

sanitation service, safety issues (including but not limited to mold remediation), 

or heating or cooling issues;

* Provide basic housing repairs or rehabilitation (including but not limited to roof 

repair and replacement);

* Pay utility bills and charges (including but not limited to water, electricity, gas, 

and basic communications services such as phone, internet, and cable);

* Pay property taxes or make payments in lieu of taxes (PILOTs).

(b) Educational Programs. Programs to—-

* Provide students (including but not limited to post-secondary students) 

transportation to and from school, tutors, and supplies (including but not limited 

to clothing, backpacks, laptop computers, musical instruments, and sports 

equipment) for use in school activities and extracurricular activities;

* Provide tuition payments for students (including but not limited to allowances 

for room and board on or off campus for the student, spouse, domestic partner, 

and Dependents) to attend preschool, school, college or university, online
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school, educational seminars, vocational education, technical education, adult 

education, continuing education, or alternative education;

* Provide for the care of children away from their homes to help their parents or 

other relatives responsible for their care to be gainfully employed or to pursue 

education; and

* Provide job counseling and programs for which the primary objective is job 

placement or training, including but not limited to allowances for-- Expenses for 

interviewing or training away from home (including but not limited to travel, 

auto expenses, lodging, and food); tutoring; and appropriate clothing for a job 

interview or training (including but not limited to an interview suit or a uniform

required during a period of training).

(c ) Elder and disabled programs. Programs for individuals who have reached 

age 55 and above or are mentally or physically disabled (as defined under applicable 

law, including but not limited to tribal government disability codes or laws) that provide-

• Meals through home-delivered meal programs or at a community center or 

similar facility;

• Home care such as assistance with preparing meals or doing chores, or day care 

outside the home;

• Local transportation assistance;

• Improvements to adapt housing to special needs (including but not limited to 

grab bars and ramps).

(d ) Cultural and religious programs. Programs to—

* Pay expenses (including but not limited to admission fees, transportation, food, 

and lodging) to attend or participate in an Indian tribe’s cultural, social, religious, or 

community activities such as pow-wows, ceremonies, and traditional dances;

* Pay expenses (including but not limited to admission fees, transportation, food, 

and lodging) to visit sites that are culturally or historically significantfor the Tribe on 

or off their reservation, including but not limited to other Indian reservations;

* Pay the costs of receiving or giving instruction about an Indian tribe’s culture, 

history, and traditions (including but not limited to traditional language, music, 

dances,symbolic arts and crafts, creation of ceremonial regalia, and participation 

within ceremonies);
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* Pay funeral and burial expenses and expenses of hosting or attending wakes, 

funerals, burials, other bereavement events, and subsequent honoring events; and

* Pay transportation costs and admission fees to attend educational, social, or 

cultural/ceremonial programs activities offered or supported by the Tribe as a 

matter of modern governance or as a matter of traditional practices or participation 

within such activities of anther tribe, located on or off an established Indian 

Reservation.

(e) Other qualifying assistance programs. Programs to—-

* Pay transportation costs such as rental cars, substantiated mileage, and fares for 

bus, taxi, and public transportation between an Indian reservation, service area, or 

service unit area and facilities that provide essential services to the public (such as 

medical facilities and grocery stores);

* Pay for the cost of transportation, temporary meals, and lodging of a Tribal Member 

or Qualified Non-member while the individual is receiving medical care away from 

home;

* Provide assistance to individuals in exigent circumstances (including but not limited 

to victims of abuse), including but not limited to the costs of food, clothing, shelter,

transportation, auto repair bills, and similar expenses;

* Pay costs for temporary relocation and shelter for individuals displaced from their 

homes (including but not limited to situations in which a home is destroyed by a fire or 

natural disaster, or other damages that limit or prevent the home from being safe for 

living within);

* Provide assistance for transportation emergencies (for example, when stranded 

away from home) in the form of transportation costs, a hotel room, and meals; and

* Pay the cost of non-prescription drugs (including but not limited to traditional Indian 

tribal medicines).

(3) Compensation Safe Harbor: For Safe Harbor Programs, and subject to amendments to 

Revenue Procedure 2014-35 hereafter, the Tribe will presume that individual need is 

met for ceremonial participants, religious leaders or spiritual officials or leaders 

(including but not limited to traditional spiritual/cultural society members, medicine 

men, medicine women, and shamans) receiving the following benefits, and that the

benefits do not represent Compensation for services: benefits provided under an Indian 

tribal governmental Program that are items of cultural significance that are not lavish or 
LUMMI NATION GWE ACT CODE DRAFT

extravagant under the facts and circumstances or nominal cash honoraria provided to 

ceremonial participants, religious or spiritual participants and officials or leaders 

(including but not limited to medicine men, medicine women, and shamans) to 

recognize their participation in cultural, religious, ceremonial social events (including 

but not limited to pow-wows, rite of passage ceremonies, funerals, wakes, burials, other 

bereavement events, and subsequent honoring events, and other traditional ceremonial 

events common to the specific tribal people or intertribal traditional activities).

(4) Safe Harbor Effective Dates: Safe harbor treatment shall be afforded to any Program or 

benefit that otherwise satisfies the safe harbor rule as of, or after, December 6, 2012, or 

for any earlier taxable period for which the period of limitation on refund or credit 

under the U.S. Internal Revenue Code Section 6511 has not expired.

(5) Non-Safe Harbor Programs: Nothing in this Ordinance or the IRS safe harbor guidance 

shall limit the Tribe's right to provide Assistance outside of the safe harbor rules. This 

guidance policy recognizes that “ambiguities” shall be resolved in the tribe’s favor, and 

it is not concluded that this code is an exhaustive listing of activities excluded from 

taxation, especially in the realm of ceremonial activities, as intended by the Exclusions 

Act (law).

42.1.202 Programs Meeting the General Test. Programs that do not qualify for

non-taxable treatment under Code Section 139E or under an IRS Safe Harbor, will nonetheless 

be treated as non-taxable if Program benefits meet the General Test for treatment under the 

General Welfare Exclusion. For purposes of the General Test only, needs must be shown in one 

of the following manners:

(1) Individual Needs. Certain Programs may be based on individual need, rather than an 

overall need of the Tribe. For those Programs, the Tribal Council may establish income 

guidelines unique to the Tribe or may use readily available income guidelines used by 

state or federal programs to demonstrate individual or family need. When individual or 

family need must be shown, the Program may take into account individual

circumstances or extraordinary need to overcome presumptions based on income 

alone.

(2) Community Needs. Certain Programs may be based on community needs, which are 

so important to the self-determination, self-government, self-regulation, and selfguidance of culture, traditions, and ceremonial activities of the Tribe that Assistance 

may be deemed necessary regardless of individual income or wealth. For example, 

states provide public education to all citizens regardless of individual income or wealth. 

Some Programs may address both individual and community-based needs. The Council
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reserves the right to require any applicant applying for consideration based on nonfinancial or community-based needs to demonstrate how the Program benefits will 

benefit the tribal community as a whole, including preservation of culture, traditions, 

traditional ceremonial activity, and self-determination. Approval based on non-financial

need criteria is made on a facts and circumstances basis and will be guided by 

traditional values and ceremonial culture. A Program will be deemed to be based on 

community or non-financial needs if so designated by the Council.

42.1.203 Purpose. All Programs hereunder shall provide a social benefit for the 

promotion of the general welfare of the Tribe and be limited to purposes consistent with 

treatment under this Ordinance. Such purposes may include, for example, and not by way of 

limitation, assistance for medical care, food, shelter, health, education, subsistence, housing, 

elder and disabled care, assistance to meet cultural, traditional, ceremonial & religious needs of

the Tribe and its membership, and assistance to promote self-sufficiency, self-determination, 

tribal image, entrepreneurship, and the employment of tribal members or other qualified 

persons (spouses and dependents). Designation by the Tribal Council of a Program as falling 

under this Ordinance shall be conclusive evidence that the Tribal Council, following a good faith 

review of Tribal needs and goals, has determined that said program, benefits, and services is 

established to achieve a social or cultural (ceremonial) benefit and to promote the general 

welfare of the Tribe. . The tribe shall assess progress on said objectives in connection with its 

budgeting and/or strategic planning process. Approved Programs shall be renewed, 

established, modified, or terminated based upon the needs of the Tribe as compared to the 

objectives set by the Council from time to time hereunder. Qualification for exclusions under 

this section may be subject to the conclusions of “consultations” with the IRS on what is 

defined and accepted as “ceremonial activity” and any otherwise clarifications secured through 

congress as a result of a “ambiguity” challenge by the tribes or the Internal Revenue Service. 

All Assistance disbursed pursuant to this Ordinance shall be designed to promote the general 

welfare, self-determination, self-governance, self-regulation, as well as protection of the 

indigenous inherent right to self-guidance of culture, traditions, and ceremonial activities of the

Tribe. The Tribal Council seeks to establish criteria for the furtherance of the “Ceremonial 

Activities” exclusions recognized by the Act of 2014 (Title 26 U.S. Internal Revenue Code, 

Section 139E). The tribes advocates and protects its rights to self-determination & selfgovernance over culture, traditions, and the definition of what composes “Ceremonial 

Activities” of the Tribal people and interacting traditional social collective. Therefore, the Tribe 

has, hereby, declared that the following types of activities comply with the definition of what 

are ceremonial practices and activities within the Lummi Tribal Society, as a participating entity 

identified within the intertribal Coast Salish collectives of Indigenous Peoples and Communties,

as follows, but not all conclusive: .
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PART I. PROTECTION OF TRADITIONAL SPIRITUALITY & CULTURE

Article 1. Protection of Native Language

Article 2. Protection of Native Knowledge of Aboriginal Land & Territory

Article 3. Protection of of Spiritual Societies- All Seasons

Article 4. Protection of Identification of Intertribal Spiritual Practices

Article 5. Protection of Traditional Songs

Article 6. Protection of Traditional Dances

Article 7. Protection of Traditional Ceremonials

Article 8. Protection of Traditional Sacred Knowledge

Article 9. Protection of Traditional Tribal Collective

Article 10. Protection of Traditional Regalia & Clothing

Article 11. Protection of Sacred Philosophy/Cosmology

Article 12. Protection of Traditional Intergenerational Relationships

Article 13. Protection of Sacred Contract with Creation

Article 14. Protection of Traditional Rules of Conduct

Article 15. Protection of Traditional Mythology

Article 16. Protection of Intertribal Marriage Rights

Article 17. Protection of Sacred Sites and Places

Article 18. Protection of Traditional Plants and Medicines 

Article 19. Protection of Native Genetic Code

Article 20. Protection Against Extinction of Ceremonial Foods

Article 21. Protection of Relationships with the Elemental

Article 22. Protection Against Ceremonially Accessing Contaminated Sites

Article 23. Protection of Traditional Subsistence Foods

Article 24. Protection of Traditional Housing Constructs

PART II. PROTECTION OF TRADITIONAL HUMAN RELATIONSHIPS
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Article 25. Protection of Inherent Gifts

Article 26. Protection of Sacred Union of Couples 

Article 27. Protection of the Traditional Family

Article 28. Protection of the Traditional Extended Family

Article 29. Protection of the Traditional Community

Article 30. Protection of Intertribal Relationships 

Article 31. Protection of Traditional Rights to Become Spiritual Practitioner

Article 32. Protection of Respect for Other Tribes’ Leadership

Article 33. Protection of Trans-boundary Rights as Indian Nations

Article 34. Protection of Respect for the Elderly

PART III. PROTECTION OF THE TRADITIONAL CHILD

Article 35. Rights of the Child

PART IV. PROTECTIN OF TRIBAL RIGHTS TO DEFINE REALITY

Article 36. Protection of Traditional Measurement of Reality

PART V. PROTECTION OF TRADITIONAL LAWS OF BALANCE

Article 37. Protecting Basic Laws of Balance

PART VI. PROTECTION AND RECOVERY FROM NON-INDIAN INFUENCES UPON TRIBAL 

COLLECTIVE

Article 38. Historical Trauma, Historical Truth, and Native Science

Article 39. Right to Express Indian View of History 

Article 40. Nation’s Rightto Represent the Tribal Collective

Article 41. Right to Develop Tribal/Intertribal Institutes

Article 42. Protection of Traditional Clusters of Knowledge

It is the clear intent of the Lummi Nation to recognize this partial list of Ceremonial 

Activities, specific to the Lummi Nation as co-participating Coast Salish Peoples, as 

qualified under the language of Title 26, U.S. Internal Revenue Code, Section 139E, as so 

much pertains to “Ceremonial Activities” that are excluded from federal taxation. It is 

understood that this listing is not conclusive as to what is intended and included within 

each subpart listed. And, that the final definitions of excluded activity is subject to 
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conclusive “Consultations” of the tribes and the Internal Revenue Service specific to 

Section 139E as so much especially relates to the “ceremonial activity” part. Thereafter, 

this code provision may be subjected to more restriction or expansion. The Lummi 

Nation specifically seeks to prevent external interference with traditional “Ceremonial 

Activity.”

42.1.204 Eligibility and Application Procedures.

(A) Each approved Program shall set forth the specific eligibility rules and limitations applied to 

that Program. Each designated department shall present program descriptions, which include 

eligibility rules and limitations, along with application forms and procedures, for approval by 

the Tribal Council or its designee. Only those descriptions, application forms and procedures 

which are approved by the Tribal Council or its designee shall be in force and effect. Program

guidelines may limit benefits to an identified group of Members or Qualified Non-members, as 

applicable. All Programs may be limited by budget availability. In the absence of specific

Program guidelines to the contrary, all Programs shall be deemed to incorporate eligibility 

criteria necessary for compliance with US IRC Section 139E.

(B) In order to provide the most effective means to qualify tribal members, their spouses, and 

dependents, for authorized assistance or benefits or services otherwise excluded from taxation

under this code (as authorized by Title 26 US Code, Section 139E), the tribe may authorize a 

“One Stop Application” process in which the qualifying persons apply with a single set of forms 

that are used to certify their financial needs or qualification for services or benefits or 

assistance, in which said single set of “forms” can be electronically shared with all approved 

programs or departments or agencies that implement the qualified tribal programs covered by 

this code, and in a manner that does not violate the need for client confidentiality requirements 

but can automatically be shared with listed tribal programs in manner that readily (re)certifies 

the applicant’s qualifications without a constant repeat of forms for the diverse programs that 

applicant may qualify for. The applicant shall sign a release form to authorize the sharing of this 

information between said programs or services or tribal agencies. Electronic sharing does not 

automatically entitle the applicant to all such services, benefits, and assistance. The applicant is 

required to contact all other such programs or entities to further clarify qualifications. 

42.1.205 Limited Use of Assistance; Substantiation. All Assistance disbursed or provided 

pursuant to this Ordinance must be used for the purpose stated in the approved Program 

description, and any application for the applicable Assistance. While it is the intent of the tribe 

to be self-determining, self-governing, self-regulating, self-accounting, and self-disclosing of all

events that are non-taxable or taxable and not in compliance with the Exclusions Act (law), it is 

hereby noted that the Tribe or its designee shall keep books or records deemed appropriate to 
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demonstrate compliance with the Ordinance. Recipients of benefits hereunder are responsible 

for maintaining their own books or records as may be required for substantiation to the IRS for 

individual income tax purposes if challenged on eligibility for exclusion. In the event that 

Assistance payments and/or services are used or pledged for a purpose inconsistent with the 

purpose set forth in the applicable approved Program or the Member’s application, the Tribal 

Council or designee may require the repayment of the welfare assistance payment. No such 

challenge may be made upon a “ceremonial activity” assistance already provided and cleared 

at time of request, due to traditional protocols practiced in association with ceremonial 

activities. The Tribal Council or designee is authorized to offset any other payments owed to a 

Tribal member ifsuch an offset is necessary to secure repayment of a welfare assistance 

payment in accordance with this Section.

42.1.300 Limitation on Payments; Annual Budgeting.

(1) Limitations on Welfare Assistance Payments. The Tribal Council, within its annual 

budgets, by resolution or by motion, may adopt guidelines establishing the maximum 

Assistance payments to be made to Tribal Members, their spouse or dependents, for 

certain specified purposes or programs or may delegate the establishment of such

limitations to the program level. Such guidelines may also include, by way of example, 

factors to be considered in determining whether deviations from the general payment 

limitations should be permitted. Departments charged with administering particular 

programs may be delegated authority to adopt program guidelines to the extent not 

contrary to the overall guidelines and limitations established by the Tribal Council 

hereunder. In no event shall Assistance be lavish or extravagant.

(2) Annual Budgeting: Unfunded Program. The Tribal Council, through its annual 

budgeting process, by resolution or by motion, shall designate those funding sources 

that are available for the payment of Assistance benefits. Notwithstanding anything to 

the contrary, the Assistance payments authorized hereunder shall be “unfunded” for tax 

purposes and no Beneficiary shall have an interest in or right to any funds budgeted for 

or set aside for Assistance payments until actually paid. Assistance benefits shall remain 

assets of the Tribe until distributed, and the Approved Programs shall be administered 

to avoid premature taxation through the doctrines of constructive receipt and/or 

economic benefit.

42.1.400 Forfeiture of General Welfare Assistance.

(1) Forfeiture. Notwithstanding anything herein to the contrary, Assistance benefits may 

be revoked or forfeited for any Beneficiary who is found to have misapplied program 

funds or to have made any misrepresentations during the application process. 
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Assistance may also be forfeited should said benefits be treated as a resource to the 

detriment of the Tribe or a Beneficiary. The Tribe shall have a right of recovery with 

regard to any excess or improper payments hereunder. Any assistance that was 

appropriately utilized within “ceremonial activity” is not subject to challenge postqualification.

(2) Due Process. Each program shall offer procedures that afford a Beneficiary an

opportunity to address forfeiture issues or concerns with the program director or

designee.

(3) Anti Alienation. A Tribal member’s rights to apply for General Welfare assistance 

payments and/or services under this Ordinance are not subject to anticipation, 

alienation, sale, transfer, assignment, pledge, encumbrance, levy, attachment or 

garnishment by creditors.

42.1.500 Programs not Limited to Means Testing. Programs that qualify under Code 

Section 139E or the IRS Safe Harbor shall not require a showing of individual need or means 

testing in order to achieve non-taxable treatment under the General Welfare Exclusion. The 

Tribe also reserves the right to provide community-based Programs and Programs based on 

non-financial need under the General Test that are not individually means tested. The Tribe 

recognizes that means testing can distort certain tribal cultural and community values. The 

Tribe has participated in consultation with the United States Treasury Department and IRS and 

will evaluate Programs periodically as guidance is further developed through consultation with 

the Tribe. Ceremonial Activities shall not be subjected to any tribal or external means testing.

42.1.501 Privacy; Information Sharing. The Tribe will maintain records regarding 

sensitive tribal and tribal Member matters, including tribal customs, religion and traditions, 

confidential from third party disclosures to the fullest extent permitted at law. If information is 

requested by IRS or other government agencies or third parties during a compliance review or 

examination, disclosures shall be limited to the extent necessary and required by law pending 

an effort to address such requests through consultation and other rights under Executive Order 

13175 on a government-to- government basis. Confidential Tribal information shall not be 

shared in a manner that would open up additional disclosure, for example, under information 

sharing agreements the recipient may be subject to or under the Freedom of Information Act.

42.1.502 Government-to-Government Relationship; Executive Order 13175.

Coordination with IRS and the United States Treasury Department on Tribal General Welfare

matters shall be grounded on a government-to-government relationship that recognizes the 

unique relationship between the federal government and the Tribal government. The federal 

government, as a result of its treaty obligations and trust responsibility, has committed to 
LUMMI NATION GWE ACT CODE DRAFT

providing education, housing, clean water, and many other basic needs for Indian people. 

Through a conscientious shift in policy in recent decades, the federal government has 

encouraged the Tribe itself to provide for such needs in partnership with the federal 

government and, increasingly in recent years, instead of the federal government. Essential to 

the government-to-government relationship is mutual respect and deference to Tribal 

governance decisions. Future consultations on General Welfare matters should reflect these 

concerns and the fact that the Tribal government, through its own policy setting process, is best 

situated to determine the needs of the Tribe and its Members and the appropriate policy 

solutions. All references to Executive Order 13175 shall include any future amendments 

thereto.

42.1.503 Other Tax Exemptions. Notwithstanding anything herein to the contrary, 

the Tribe reserves the right to waive income limits or needs basis criteria, to the extent 

otherwise applicable, for expenditures that otherwise qualify for tax exemptions including tax 

exemptions under Titles 25 or 26 of the United States Code so long as the conditions for 

exemption are met. Without limitation, this includes Member medical benefits exempt under 

Section 9021 of the Patient Protection and Affordable Care Act of 2010 (Code Section 139D) 

and per capita expenses exempt under 25 U.S.C. Sections 1407 and 1408.

42.1.600 Governing Law. All rights and liabilities associated with the enactment of

this code, or the welfare assistance payments made hereunder, shall be construed and 

enforced according to the laws of the Lummi Nation.

42.1.700 Severability. If any provision of this code is held to be invalid, the remainder 

of this code shall not be affected.
LUMMI NATION GWE ACT CODE DRAFT

CHAPTER 42.2: INDIAN FISHING RIGHTS EXEMPTIONS PER U.S. INTERNAL REVENUE CODE 

SECTION 7873

INDEX

CHAPTER/SUBCHAPTER/SECTION

42.2.O10 . GENERAL

1. PURPOSE

2. BACKGROUND STATEMENT

3. DEFINITIONS

42.2.100. Qualified Indian Fishers

42.2.110. Qualified Lummi Fishing Vessel Operation

42.2.120. Qualified Lummi Fishing Assistant

42.2.130. Qualified (Fishing) Entity

42.2.140. Lummi Fisher Income Qualified for Exemption Status

42.2.150. Types of Qualified Fishing Activity

42.2.160. Any Lummi Fishing Gear Processing, Preparing, or Construction

42.2.170. Any Training of Future Tribal Fishers

42.2.180. Directly Related Fishing Activity of Cooperative, Association, or Fisher Corporation

42.2.190. Any Qualified & Enrolled Tribal Member Involved in Directly Related Activity

42.2.200. Percentage of Directly Related Activity

42.2. 210. Lummi Nation Duty to Represent Protected Treaty Rights

42.2.220. Internal Revenue Service Challenges to Section 7873.

42.2.230. All are “Tribal Indians.” 
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42.2.240. Lummi Treaty Protected Rights. 

42.2.250. Treaty Relationship.

42.2.260. Treaty Rights Abrogation.

42.2.270. Lummi and the Claims Commission

42.2.280. Lummi Specifically Reserves all Economic Rights to Reef-Netting.

42.2.290. Lummi Eco-Fishing Tourism- Grounds, Camps, Sites

42.2.300. LIBC May Designate Investigations

42.2.310. Internal Revenue Audits and Findings. 

42.2.320. Lummi Nation Accounting Office. 

42.2.330. Lummi Accounting Office and Ceremonial/Cultural Activity.

42.2.340. Directly Related Activity Exemptions Limited:

42.2.350. Does Not Limit Lummi Nation.

42.2.360. Expansion under Federal Determinations

42.2.370. Severability. 

42.2.O10 GENERAL

This Chapter of the Lummi Foreign Tax Code shall be known as the Lummi Fishing Rights 

Exclusions Code. Title 26 United States Internal Revenue Code Section 7873 Provides: Income 

derived by Indians from exercise of fishing rights are excluded from federal, state, Social 

Security, and unemployment taxes. 

(i) Income and self-employment taxes

No tax shall be imposed by the federal and state governments on income derived—

(A) by a member of an Indian tribe directly or through a qualified Indian entity, or

(B) by a qualified Indian entity,

from a fishing rights-related activity of such tribe.

(ii) Employment taxes

No tax shall be imposed by the federal or state governments on remuneration paid for 

services performed in a fishing rights-related activity of an Indian tribe by a member of 

such tribe for another member of such tribe or for a qualified Indian entity.
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1. Purpose: The purpose is to memorialize the procedures used by the Lummi Indian Nation to 

determine which parts of the protected Indian Fishing Rights are excluded fully or partially from 

external taxation by foreign governments ( state or federal) as provided for under the U.S. 

Internal Revenue Code Section 7873, in regards to cited language above (i) Income and selfemployment taxes and (ii) Employment taxes.

2. Background and Intent: the Lummi Indian Nation is a federally recognized Indian 

Tribe. It has a government to government treaty relationship with the United States (12 

Stat. 927, negotiated in 1855, ratified by the Senate in 1859, and Proclaimed by the 

President in 1859). The Lummi Nation is self-determining and self-governing and has 

exercised both modern-limited constitutional governance and inherent sovereignty. It, 

like other Indian Nations, has “fishing rights” protected by treaty, act of congress, or 

executive orders. The U.S. Congress, in 1989, as signed into law by the President, had 

Amended the 1986 Internal Revenue Code adding Section 7873 which proclaimed that 

Indian Fishing Rights protected by treaty, act of congress, or executive order are 

excluded from taxation by the United States and the individual states. The intent of this 

chapter is to further define the limits and boundaries of the tax exclusions as a matter of 

tribal law so as to avoid conflicts with the U.S. Internal Revenue Service or individual 

state over implementation of this law.

3. Definitions: In construing the purposes of this Chapter of the Lummi Foreign Tax 

Code, the following works and phrases shall have the meaning designated in this section 

unless a different meaning is expressly provided or the context provides otherwise. 

(a) “Lummi Indian Nation” or “Lummi Tribe” or “Tribe” shall mean the Lummi 

Indian Nation unless otherwise stated;

(b) “Lummi Indian Treaty” shall be a reference to the Treaty of the Dwamish, 

Suquamish and Allied Tribes, otherwise known as the Point Elliot Treaty (12 Stat. 

927, as negotiated in 1855 and ratified and proclaimed in 1859), any reference to 

the treaty shall include any applicable act of congress or executive order 

intended to implement or limit the original respective treaty or other applicable 

treaties;

(c) “Lummi Fishermen” shall mean every enrolled man, woman, and child of the Lummi 

Indian Nation actively engaged in some form of fishing rights activity protected by law, 

unless otherwise provided in the specific language used herein. Based on the laws of the 

Lummi Nation spouses may be included in the definition of eligible fisher persons;
LUMMI NATION GWE ACT CODE DRAFT

(d) “Lummi Government” shall include all parts of the Lummi government, its 

departments, agencies, companies, corporations (profit or non-profit), groups, 

associations, etc., unless otherwise specified. The Lummi government is 

composed of persons or employees that perform services for , or protect 

benefits or rights of Lummi People and Fishermen as a direct or indirect duty, 

responsibility, or obligation of tribal governmental protection of Indian Fishing 

Rights;

(e) “Indian Fishing Rights” are all aspects and parts of the “rights” that are 

protected by treaty, executive order, or act of congress, as have been or may be 

adjudicated under federal law;

(f) “Indian Treaty Fishing Rights” are rights owned by every man, woman, and 

child of the Lummi Indian Nation, as if each and every one of them had 

individually signed the treaty. 

(g) For purposes of this part, the IRS has provided the following definitions for 

implementation of the law- as (Added Pub. L. 100–647, title III, §3041(a), Nov. 

10, 1988, 102 Stat. 3640.)

(1) Fishing rights-related activity: The term “fishing rights-related 

activity” means, with respect to an Indian tribe, any activity directly related to 

harvesting, processing, or transporting fish harvested in the exercise of a 

recognized fishing right of such tribe or to selling such fish but only if 

substantially all of such harvesting was performed by members of such tribe.

(2) Recognized fishing rights: The term “recognized fishing rights” means, 

with respect to an Indian tribe, fishing rights secured as of March 17, 1988, by a 

treaty between such tribe and the United States or by an Executive order or an 

Act of Congress.

(3) Qualified Indian entity: 

(A) “Qualified Indian Entity” In general, the term “qualified Indian 

entity” means, with respect to an Indian tribe, any entity if—

(i) such entity is engaged in a fishing rights-related activity of such 

tribe,

(ii) all of the equity interests in the entity are owned by qualified 

Indian tribes, members of such tribes, or their spouses,

(iii) except as provided in regulations, in the case of an entity 

which engages to any extent in any substantial processing or transporting 

of fish, 90 percent or more of the annual gross receipts of the entity is 
LUMMI NATION GWE ACT CODE DRAFT

derived from fishing rights-related activities of one or more qualified 

Indian tribes each of which owns at least 10 percent of the equity 

interests in the entity, and

(iv) substantially all of the management functions of the entity are 

performed by members of qualified Indian tribes.

For purposes of clause (iii), equity interests owned by a member 

(or the spouse of a member) of a qualified Indian tribe shall be treated as 

owned by the tribe.

(B) Qualified Indian tribe

For purposes of subparagraph (A), an Indian tribe is a qualified Indian 

tribe with respect to an entity if such entity is engaged in a fishing rightsrelated activity of such tribe.

(C ) Special rules defined as applied to protected fishing rights:

(1) Distributions from qualified Indian entity: For purposes of this 

section, any distribution with respect to an equity interest in a qualified 

Indian entity of an Indian tribe to a member of such tribe shall be treated 

as derived by such member from a fishing rights-related activity of such 

tribe to the extent such distribution is attributable to income derived by 

such entity from a fishing rights-related activity of such tribe.

(2) De minimis unrelated amounts may be excluded: If, but for this 

paragraph, all but a de minimis amount—

(A) derived by a qualified Indian tribal entity, or by an individual through 

such an entity, is entitled to the benefits of paragraph (1) of subsection 

(a), or

(B) paid to an individual for services is entitled to the benefits of 

paragraph (2) of subsection (a), then the entire amount shall be entitled 

to the benefits of such paragraph.

42.2.100: Qualified Lummi Fishers: All persons that claim to be legally entitled to fish under the 

laws and rights of the Lummi Indian Nation must be enrolled with the Lummi Indian Nation, 

exceptions being applicable to qualified spouses or dependents participating in the fishing 

activity, as determined to be qualified by the Lummi Nation. And, in addition to this Qualified 

Enrollment status they must register with the Lummi Fisheries Department as an active 

fisherman. In exercising any fishing rights, as a Lummi Indian Fisherman, protected by any 

applicable federal law, treaty, executive order, or act of congress then any compensation or 

share of any income or revenues they receive derived from such directly related activity or 
LUMMI NATION GWE ACT CODE DRAFT

operations are qualified as excluded from federal and state taxation, including any qualified de 

minimus amounts.

42.2.110. Qualified Lummi Fishing Vessel Operations: All fishing vessels operating under 

authorization of the Lummi Indian Nation must be registered with the Lummi Fisheries Division 

as governed over by the Lummi Natural Resources Department and receive and display on 

their fishing vessel the respective tribal identification numbers or plates if they choose to 

harvest fishing products or other floral and faunal species for commercial, ceremonial, or 

subsistence purposes . Such fisherperson must provide proof, as required by the Lummi 

Fisheries Divisions, of ownership of said vessel regardless of size and dimension. Any 

compensation or share of any income or revenues they receive derived from such operations 

are qualified as excluded from federal and state taxation, including any qualified de minimus 

amounts, as authorized by Title 26 U.S. Internal Revenue Code, Section 7873.

42.2.120. Qualified Lummi Fishing Assistant: Any enrolled tribal member, or dependent of a 

tribal member or spouse of an enrolled tribal member may provide assistance as a worker or 

fishing employee or deck hand for any Qualified Lummi Fisherman that owns a Qualified Lummi 

Fishing Vessel. Provided, when located on the waters and in actual control of or participating as 

a deck hand or assistant the said Fishing Assistant had his or her tribal fishing card or other 

form of authorized participation upon their person. Any compensation or share of any income 

or revenues they receive derived from such operations are qualified as excluded from federal 

and state taxation, including any qualified de minimus amounts.

(a) This section does not provide authorization for “spouses” that are not qualified for 

enrollment within the Lummi Nation to be on-board assisting in the fishing operations 

or operating the fishing vessel, unless otherwise specifically authorized by the Lummi 

Nation elsewhere in governance over the implementation of fishing rights. 

42.2.130. Qualified (Fishing) Entity. See definition above per Qualified Indian Entity. Any 

qualified tribal member may own, operate, or partially own or operate any entity that 

specializes in the harvesting, purchasing, handling, processing, marketing, and transporting fish 

or fish products taken or harvested from within the adjudicated ‘Usual and Accustomed 

Fishing Grounds and Stations’ of the Lummi Nation. Any compensation or share of any income 

or revenues they individually receive derived from such operations are qualified as excluded

from federal and state taxation, including any qualified de minimus amounts.

(a) income of such “entity” must meet the Qualified Entity test provided herein to

assure their right to fully or partially exempt income or revenue from federal and state 

taxation.
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42.2.140. Lummi Fisher Income Qualified for Exclusion Status. Any income that is directly 

related to the fishing rights activity of the Lummi Nation, as protected by treaty, federal law, or 

executive order, as exercised by qualified tribal fishers (and their spouses or dependents), shall 

be excluded from federal or state taxation under Title 26 U.S. Internal Revenue Code Section 

7873, provided the income is derived from fish or fish products, or other floral or faunal

products protected by law and included within the fishing harvest rights of the Lummi People, 

and harvested from within Lummi Usual and Accustomed Fishing Grounds and Stations, 

including any qualified de minimus amounts.

(a) It is, hereunder, noted that Title 26 U.S. Internal Revenue Code Section 7873 

provides for inclusion of a de minimus amount in the calculation of non-taxable status of 

income.

42.2.150. Types of Qualified Fishing Activity: .Any activity, authorized under Lummi Law (and 

thereby federal or state law as a matter of extension), that is associated with the harvest, catch, 

transporting, hauling, selling, trading, processing, or marketing of anadromous or nonanadromous fish, shell fish, bottom fish, or other plants or animals or sea life that results in 

profits, revenue, or income to Qualified Lummi Fishers is considered qualified fishing activity 

and any compensation or share of any income or revenues they receive derived from such 

operations are qualified as excluded from federal and state taxation, , including any qualified 

de minimus amounts.

42.2.160. Any Lummi Fishing Vessel or Gear Processing, Preparing, Assembly, Maintenance, or 

Constructing: Any qualified Lummi Fisher or their dependents or spouse that is involved in any 

activity associated with or involved with the processing, preparing, assembly, maintenance, or 

construction of any fishing vessel or associated fishing gear or machinery to be used or is used 

in the harvest activity, or other qualified fishing activity, and where a compensation or share of 

any income or revenues was received or derived from such activity or operations then the 

same shall be considered as qualified as excluded from federal and state taxation, including 

any qualified de minimus amounts.

42.2.170. Any Training of Future Tribal Fishers. Any training or education or instruction of 

qualified tribal members, regardless of their age or gender, in the history, culture, laws, 

economics, and politics associated with the exercise of and protection of Lummi Fishing Rights, 

Usual and Accustomed Ground and Stations, essentials of fish population management, habitat 

protection, and the transmission of any cultural or traditional knowledge associated with said 

fishing rights or other relevant issues where the instructor or elder is paid compensation for 

such work then such compensation shall be considered as directly derived from exercising the 

fishing right and shall be considered qualified as excluded from federal and state taxation, 

including any qualified de minimus amounts.
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42.2.180. Directly Related Fishing Activity of Cooperative or Association or Fisher Corporation. 

Any Qualified Entity activity associated with the harvesting, hauling, unloading, processing, 

marketing of fish products or floral & faunal products protected by Lummi law and taken under 

color of Lummi law by a group of Lummi fishers, operating as a cooperative, association, or 

fishers corporation mutually owned, where income is produced and distributed to the owners 

then said distributions, dividends, or income shall be considered as quailed as excluded from 

federal and state taxation, including any qualified de minimus amounts.

42.2.190. Any Qualified & Enrolled Tribal Member Involved in Directly Related Activity. 

Modern Fisheries is managed, per order of the federal courts, as adjudicated, for the protection 

and enhancement of the relevant species, and conservation necessity activity is a manifest duty 

of tribal government in exercising the protected fishing rights. Phase I rights adjudicated the 

types of harvest activity (commercial, ceremonial, subsistence) and who and where the 

harvests can take place per each tribe and their members. Phase II identified the right to earn a 

moderate living income and to have the salmon habitat/environment protected from 

degradation activity. Qualified Tribal Members may be involved in the following types of 

activity and still meet the “directly related test” as follows-

(a) fisheries executive management staff

(b) fisheries enforcement officers

(c) fish technicians or scientists or assistants

(d) in-stream data collection activity

(e) spawning grounds quality & protection

(f) policy management and decisions making activities

(g) fishing court proceedings and staffing

(h) management of fish processing and marketing plants or operations

(i) intergovernmental negotiations and representation on fishing rights

(j) fish habitat and correlated environmental restoration (e.g.,spawning grounds 

enhancement or recovery, stream buffer zones)

(k) hatchery maintenance, financing, construction, and operations

(l) wild stock protection, species perpetuation, sustained yield management

(m) river water flow protection

(n) protecting, practicing, and transmission of traditional knowledge and cultural

ceremonial activities & practices associated with perpetuation, protection, and social 

responsibility to assure sustainable and viable fish populations and habitat protection. 

42.2.200. Percentage of Directly Related Activity. All Lummi employees (that are qualified 

Lummi Tribal Members and Enrolled) that believe they are qualified for a percent of their 

compensation or employment income to be tax exempt, based on the amount of time they 

dedicate to “directly related” fishing activity, must provide a written and signed statement as to 
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how much of their regular forty hour work week is allocated between fishing related activity 

and non-fishing related activity. Any such statement must be approved by their immediate 

supervisor or department director who is acknowledging the estimated percentage of exempt 

activity being addressed with each employee/tribal member seeking a qualified percentage 

exemption. Current job descriptions for the relevant position shall be attached to the 

memorandum and kept with the file. This statement shall be filed with the Lummi Personnel 

Office. For example, an employee or staff person may be assigned to protect fish habitat and 

fishing rights two full days of the week. This translates into a forty percent exempt activity 

determination that is approved by his supervisor and filed with the Personnel Office. And salary 

and taxes shall be logged and paid out according to this formula, for this specific employee. 

Time cards shall reflect the allocation. Another example, is a member of the LIBC or other 

authorized tribal delegates are assigned by resolution or executive order of the chairman to 

represent the Lummi Nation at the NWIFC and intertribal and intergovernmental negotiations & 

conferencing on fishing rights protection and implementation. If paid, then his time is allocated 

based on percentage of work week hours dedicated to this representation/policy level work. 

Neither of these two examples can claim exemption status of the other activity that is not 

fisheries related.

42.2. 210. Lummi Nation Duty to Represent Protected Treaty Rights. Based on traditional, 

inherent forms of tribal governance, and modern constitutional forms of tribal popular 

sovereignty, the Lummi Indian Nation is represented by the Lummi Indian Business Council in all 

matters relevant to the Protection of Lummi Treaty Rights. All intergovernmental relationships 

are matters of diplomacy and must be governed over and managed by action of the LIBC or 

their authorized delegates. All representation by tribal members, in lieu of direct LIBC 

delegates, must be approved by LIBC Resolution per its power to delegate authorization under 

by the Lummi Constitution or memorialized by the Chairman’s office on his/her delegation of 

official representation by a non-LIBC member but qualified as a enrolled tribal person. Any 

compensation, payment, or reimbursement associated with this representation is excluded 

under Title 26, U.S. Internal Revenue Code, Section 7873 from federal or state taxes, including 

any qualified de minimus amounts.

42.2.220. Internal Revenue Service Challenges to Section 7873. Any challenges to the tax 

exemptions claimed by Lummi Fishers or persons or personnel involved in “Directly Related 

Activities” shall be considered a challenge to Lummi Treaty Rights and Tribal Sovereignty. The 

LIBC shall represent the Tribe and Fishers in such legal proceedings, provided the challenged 

action was addressed by this code and the qualified tribal fisher or tribal employee was in 

compliance with requirements of this code.

42.2.230. All are “Tribal Indians.” Contrary to the 1940 Department of Interior Solicitor’s 

Opinion (“Excluding Indians not taxed”), and in conformity with the U.S. Constitution, as 

amended (See: Elk v. Wilkins, 1884 and Reconstruction Debates of 39th & 40th U.S. Congresses 

regarding 14th Amendment), the Lummi Nation believes all enrolled tribal members are “Tribal 

Indians” that are not to be taxed by foreign/external governments (USA or individual states).
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And, the LIBC holds that such qualified members still meet the constitutional qualifications of 

“Excluding Indians not taxed.” 

42.2.240. Lummi Treaty Protected Rights. Not all treaty protected rights of the Lummi Nation 

have been adjudicated. The Lummi Nation protects, as a matter of law and governmental 

policy, all Lummi Rights to harvest, collect, process, manage, or otherwise, any natural 

resources reserved by the treaty but not specifically delineated or adjudicated.

42.2.250. Treaty Relationship. The treaties are a “Grant of rights not from the United States to 

the Indian Tribes but a grant of rights from the tribes to the United States.” And, any rights not 

ceded or transferred to the United States by treaty-made are reserved as inherently still owned 

by the Lummi Nation and People. (See: United States v. Winans, 1905).

42.2.260. Treaty Rights Abrogation. Once the United States ratified the Point Elliot Treaty, by 

constitutional process or by act of taking the benefits of the treaty, it was bound by its honor in 

perpetuity, unless it returns all it gained from the treaty cessions it cannot abrogate the 

treaties-made. . Lummi Nation rejects the conclusion of Lonewolf v. Hichcock (1903) on the 

power of the US to unilaterally abrogate the treaty without returning its gains. Lummi Nation, 

hereby, declares that no rights secured by or reserved by the nation, per the treaty, has been 

surrendered by the nation or lawfully abrogated by the United States.

42.2.270. Lummi and the U.S. Claims Commission. The Lummi Nation, as authorized by US 

Congressional waiver of its sovereignty immunity, had made legal claims to its pre-treaty 

aboriginal territory, that included the waters and lands of the San Juan Islands network from 

Straits of Juan de Fuca northward and its associated US main-lands to and across the Canadian 

Border. Lummi never accepted any unconscionable offer by the US to purchase its aboriginal 

territories or waters originally ceded by treaty agreement provided the US comply with the 

treaty terms, and reserves all rights to harvest resources from all those areas it claimed as 

within it’s aboriginal territory and associated usual and accustomed fishing grounds and 

stations.

42.2.280. Lummi Specifically Reserves all Commercial, Ceremonial, and Subsistence Rights to 

Reef-Netting Fishing Operations. The Lummi Nation, along with the Semiahmoo, Samish, 

Sklallum, Sokes, Songish, and Sannich, have and own rights to all reef net sites individually & 

historically owned by prominent members of the respective nation(s) within their relevant 

Usual and Accustomed Fishing Grounds and Stations, as governed by the traditional tribal and 

intertribal laws and customs. The rights to the sites of the Lummi Nation has been partially 

adjudicated in U.S. v. Washington (1974), and has therein partially established such operations 

and sites as a property and treaty right of the Lummi Nation. This right includes the rights to 

the commercial, ceremonial, and subsistence value of the sites. All qualified tribal members 

that are traditionally and genetically family members from historic reef net site(s) owners or 

captains are entitled to exercise these rights. Such rights cannot be transferred or extended to 

family members that are enrolled in other tribes and operate as fishers therein. However, such 

inherited rights to harvest by qualified fishers enrolled in any one of the other Reef Net Tribes 

can be authorized by the Lummi Nation as may be needed for management purposes.
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42.2.290. Lummi Eco-Fishing Tourism- Grounds, Camps, Sites: Lummi Nation authorizes 

Qualified Tribal Fishers to develop teaching, training, or cross-cultural seminars or camps or 

operations to be formed and operated as a means of “Fishing Eco-tourism.” Such activity may 

operate within Lummi Adjudicated Usual and Accustomed Fishing Grounds and Station and 

correlated aboriginal territory. And in exercise of Lummi Treaty Rights, such entities or parties 

of traditionalists or tribal fishers may erect temporary shelters therein, as adjudicated. Lummi 

Nation considers all economic value of such activity to be “Directly Related” for all those 

persons that are Enrolled Lummi Tribal members and/or from tribes that exercise mutual 

fishing rights within Lummi Usual and Accustomed Fishing Grounds and Stations.

42.2.300. LIBC May Designate Investigations. The Lummi Indian Business Council is responsible 

for protecting the rights of Lummi Fishers. It, also, has a duty to assure that tribal members, in 

this case tribal fishers (including their qualified spouses and dependents) or others involved in 

directly related fishing activity as a matter of employment in lieu of fishing, are in compliance 

with this code. The LIBC may designate its members, or others due to their layman status or

professionalism, to investigate any activity or persons that claims exclusions not authorized by 

this code. The investigation is limited to: 

(a) Determine if the person is enrolled in Lummi or qualified spouse or dependent(s);

(b) Determine if they are in a job authorized by Lummi law;

(c ) Determine if the job is “directly related” Lummi fishing activity; and they complied 

with the requirements of this code in the performance of their job duties;

(d ) Determine the amount of activity determined or qualified as directly related;

(e ) Determine if the “Activity” should be considered as “Oversight” of what Lummi 

considers as “directly related” and “qualified” under this code;

(f ) Determine whether the tribe or Person was in error and assess the Risk of IRS Audit 

and Challenges;

(g ) Determine Tax Liability of Tribe or Person;

(h ) Make Recommendations to LIBC on Resolution of Conflict;

(I ) Make Recommendation of Whether Legal Counsel is Needed from Office of 

Reservation Attorney or as contracted by authority of the LIBC.

42.2.310. Internal Revenue Audits and Findings. The Lummi Nation objects to any 

unannounced requests or actions of the U.S. Department of Treasury, Internal Revenue Service, 

to seeks to conduct unauthorized audits of tribal accounting office records in search of possible 

tribal or individual failures to properly record and file proper tax forms associated with 

payments made to Qualified Tribal Members that conduct “Directly Related” activity associated 
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with the Lummi Treaty Fishing Rights implementation, as required per orders of the U.S. 

Federal District Court or U.S. Supreme Court (Phase I and Phase II). Lummi Nation indemnifies 

its employees and shall protect their rights to Exclusion under Title 26 U.S. Internal Revenue 

Code Section 7873. Further,

(a) Lummi Accounting must inform the Office of the Chairman and Reservation 

Attorneys Office of all cases or incidents in which the IRS has served notice they believe 

there has been failure(s) to file needed taxable income forms on allegedly questionable 

“Directly Related” fishing activity. Such reception of an IRS notice of intent to conduct 

audits must be provided immediately after first contact by the IRS with any and all 

Lummi Accounting Staff or personnel. Accounting staff or personnel shall follow the 

directives of the Chairman and Reservation Attorneys. Such directives shall be tailored 

to assure compliance with applicable tribal and federal law and specifically be tailored 

toward avoidance of unnecessary IRS audits, and shall hold said tribal employees 

harmless.

(b) Lummi Accounting must inform, in writing, the Office of the Chairman and the Office 

of the Reservation Attorneys about any conflicts they have with the Tax Exclusions 

Claimed as Valid by the Nation or its qualified employees, staff, personnel, where 

Accounting Office believes they are compelled to file respective IRS forms on what they 

have concluded was a questionable qualified exclusion, before they file any such form

with the US Internal Revenue Service.

42.2.320. Lummi Nation Accounting Office. Lummi Nation Accounting Office is obligated to 

inform or give notice to the Office of the Reservation Attorneys and Office of the Chairman in 

any and all cases in which the U.S. Dept. of Treasury, Internal Revenue Service initiates contact 

and gives notification of intent to conduct an investigative audit of tribal records. Said 

Accounting Office is ordered to Notify any and all IRS Officials that they cannot cooperate with 

any audits until this notification has been provided to said tribal officials and official guidance 

response has been received and placed on file with Accounting Records. 

(a) if necessary, the Lummi Accounting Office shall close down all respective operations 

until such conflict is addressed by the LIBC. Accounting Office personnel shall be held 

harmless for compliance with this code.

42.2.330. Lummi Accounting Office and Ceremonial/Cultural Activity. The Lummi Accounting 

Office is not authorized to file any routine taxable income tax forms on any financial payments 

made to Qualified Enrolled Lummi Indians that have sold to or provided the Lummi Nation with 

any traditional, cultural, ceremonial arts and crafts associated with traditional tribal mythology 

and symbolism of Lummi Creation Mythology associated with “fishing activity” of the Lummi 

Nation. In addition, such exclusion is found under Chapter 42.1 Tribal General Welfare 

Exclusions Act. For example, traditional fisheries sustainability was transmitted intergenerationally by the Salmon Woman Myths and the Creation Myths of the Reef Nets and
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symbolic manifestation through the totemic arts and regalia symbolism was a part of the 

Native Science that taught intergenerational respect for sustained yield.

42.2.340. Directly Related Activity Exclusions Limited: Any claims to exclusion from taxation 

under Title 26 U.s. Internal Revenue Code Section 7873, and the laws of the Lummi Nation, are 

valid if and only if it is established as taking place within Lummi adjudicated usual and 

accustomed fishing grounds and stations, unless such activity is an extension of valid reasons 

for operating outside of this adjudicated area (e.g., marketing the products outside the area or 

advocating intertribal and interstate protection measures for the treaty fishing rights or species 

involved). 

42.2.350. Does Not Limit Lummi Nation. This code does not limit the rights and powers of the 

Lummi Nation to impose its own taxes upon any fishing activity or directly related fishing 

activity authorized under the laws of the Lummi Nation. 

42.2.360. Expansion under Federal Determinations. It has been presented that the U.S. Internal 

Revenue Service has sought clarification that Section 7873 Qualified Income is not taxable but 

may be treated as “compensation” for the purpose of establishing an individual’s eligibility for 

participation in certain qualified retirement plans. Such final determinations, therefore, are 

adopted and authorized by this section of the code until otherwise changed by applicable law.

42.2.360 Severability. If any provision of this code is held to be invalid, the remainder of this 

code shall not be affected.