H. R. 3043 

One Hundred Thirteenth Congress 

of the 

United States of America 

AT THE SECOND SESSION 

Begun and held at the City of Washington on Friday, 

the third day of January, two thousand and fourteen 

An Act 

To amend the Internal Revenue Code of 1986 to clarify the treatment of general 

welfare benefits provided by Indian tribes. 

Be it enacted by the Senate and House of Representatives of 

the United States of America in Congress assembled, 

SECTION 1. SHORT TITLE. 

This Act may be cited as the ‘‘Tribal General Welfare Exclusion 

Act of 2014’’. 

SEC. 2. INDIAN GENERAL WELFARE BENEFITS. 

(a) IN GENERAL.—Part III of subchapter B of chapter 1 of 

the Internal Revenue Code of 1986 is amended by inserting before 

section 140 the following new section: 

‘‘SEC. 139E. INDIAN GENERAL WELFARE BENEFITS. 

‘‘(a) IN GENERAL.—Gross income does not include the value 

of any Indian general welfare benefit. 

‘‘(b) INDIAN GENERAL WELFARE BENEFIT.—For purposes of this 

section, the term ‘Indian general welfare benefit’ includes any payment made or services provided to or on behalf of a member of 

an Indian tribe (or any spouse or dependent of such a member) 

pursuant to an Indian tribal government program, but only if— 

‘‘(1) the program is administered under specified guidelines 

and does not discriminate in favor of members of the governing 

body of the tribe, and 

‘‘(2) the benefits provided under such program— 

‘‘(A) are available to any tribal member who meets 

such guidelines, 

‘‘(B) are for the promotion of general welfare, 

‘‘(C) are not lavish or extravagant, and 

‘‘(D) are not compensation for services. 

‘‘(c) DEFINITIONS AND SPECIAL RULES.—For purposes of this 

section— 

‘‘(1) INDIAN TRIBAL GOVERNMENT.—For purposes of this section, the term ‘Indian tribal government’ includes any agencies 

or instrumentalities of an Indian tribal government and any 

Alaska Native regional or village corporation, as defined in, 

or established pursuant to, the Alaska Native Claims Settlement Act (43 U.S.C. 1601, et seq.). 

‘‘(2) DEPENDENT.—The term ‘dependent’ has the meaning 

given such term by section 152, determined without regard 

to subsections (b)(1), (b)(2), and (d)(1)(B). 

‘‘(3) LAVISH OR EXTRAVAGANT.—The Secretary shall, in consultation with the Tribal Advisory Committee (as established 
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under section 3(a) of the Tribal General Welfare Exclusion 

Act of 2013), establish guidelines for what constitutes lavish 

or extravagant benefits with respect to Indian tribal government programs. 

‘‘(4) ESTABLISHMENT OF TRIBAL GOVERNMENT PROGRAM.— 

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. 

‘‘(5) CEREMONIAL ACTIVITIES.—Any items of cultural significance, reimbursement of costs, or cash honorarium for participation in cultural or ceremonial activities for the transmission 

of tribal culture shall not be treated as compensation for services.’’. 

(b) CONFORMING AMENDMENT.—The table of sections for part 

III of subchapter B of chapter 1 of such Code is amended by 

inserting before the item relating to section 140 the following new 

item: 

‘‘Sec. 139E. Indian general welfare benefits.’’. 

(c) STATUTORY CONSTRUCTION.—Ambiguities in section 139E 

of such Code, as added by this Act, shall be resolved in favor 

of Indian tribal governments and deference shall be given to Indian 

tribal governments for the programs administered and authorized 

by the tribe to benefit the general welfare of the tribal community. 

(d) EFFECTIVE DATE.— 

(1) IN GENERAL.—The amendments made by this section 

shall apply to taxable years for which the period of limitation 

on refund or credit under section 6511 of the Internal Revenue 

Code of 1986 has not expired. 

(2) ONE-YEAR WAIVER OF STATUTE OF LIMITATIONS.—If the 

period of limitation on a credit or refund resulting from the 

amendments made by subsection (a) expires before the end 

of the 1-year period beginning on the date of the enactment 

of this Act, refund or credit of such overpayment (to the extent 

attributable to such amendments) may, nevertheless, be made 

or allowed if claim therefor is filed before the close of such 

1-year period. 

SEC. 3. TRIBAL ADVISORY COMMITTEE. 

(a) ESTABLISHMENT.—The Secretary of the Treasury shall establish a Tribal Advisory Committee (hereinafter in this subsection 

referred to as the ‘‘Committee’’). 

(b) DUTIES.— (1) IMPLEMENTATION.—The Committee shall advise the Secretary on matters relating to the taxation of Indians. 

(2) EDUCATION AND TRAINING.—The Secretary shall, in consultation with the Committee, establish and require— 

(A) training and education for internal revenue field 

agents who administer and enforce internal revenue laws 

with respect to Indian tribes on Federal Indian law and 

the Federal Government’s unique legal treaty and trust 

relationship with Indian tribal governments, and 

(B) training of such internal revenue field agents, and 

provision of training and technical assistance to tribal 

financial officers, about implementation of this Act and 

the amendments made thereby. 

(c) MEMBERSHIP.— 
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(1) IN GENERAL.—The Committee shall be composed of 7 

members appointed as follows: 

(A) Three members appointed by the Secretary of the 

Treasury. 

(B) One member appointed by the Chairman, and one 

member appointed by the Ranking Member, of the Committee on Ways and Means of the House of Representatives. 

(C) One member appointed by the Chairman, and one 

member appointed by the Ranking Member, of the Committee on Finance of the Senate. 

(2) TERM.— 

(A) IN GENERAL.—Except as provided in subparagraph 

(B), each member’s term shall be 4 years. 

(B) INITIAL STAGGERING.—The first appointments made 

by the Secretary under paragraph (1)(A) shall be for a 

term of 2 years. 

SEC. 4. OTHER RELIEF FOR INDIAN TRIBES. 

(a) TEMPORARY SUSPENSION OF EXAMINATIONS.—The Secretary 

of the Treasury shall suspend all audits and examinations of Indian 

tribal governments and members of Indian tribes (or any spouse 

or dependent of such a member), to the extent such an audit 

or examination relates to the exclusion of a payment or benefit 

from an Indian tribal government under the general welfare exclusion, until the education and training prescribed by section 3(b)(2) 

of this Act is completed. The running of any period of limitations 

under section 6501 of the Internal Revenue Code of 1986 with 

respect to Indian tribal governments and members of Indian tribes 

shall be suspended during the period during which audits and 

examinations are suspended under the preceding sentence. 

(b) WAIVER OF PENALTIES AND INTEREST.—The Secretary of 

the Treasury may waive any interest and penalties imposed under 

such Code on any Indian tribal government or member of an Indian 

tribe (or any spouse or dependent of such a member) to the extent 

such interest and penalties relate to excluding a payment or benefit 

from gross income under the general welfare exclusion. 

(c) DEFINITIONS.—For purposes of this subsection— 

(1) INDIAN TRIBAL GOVERNMENT.—The term ‘‘Indian tribal 

government’’ shall have the meaning given such term by section 

139E of such Code, as added by this Act. 
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(2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ shall have the 

meaning given such term by section 45A(c)(6) of such Code. 

Speaker of the House of Representatives. 

Vice President of the United States and

President of the Senate.