Source: https://caselaw.findlaw.com/us-supreme-court/295/418.html
Timestamp: 2019-04-21 15:19:49+00:00

Document:
Messrs. Thomas J. Reilly and Arthur F. Mullen, both of Washington, D. C., for petitioner.
The Attorney General and Frank J. Wideman, Asst. Atty. Gen., for respondent.
Sandy Fox, for whom this suit was instituted, is a full-blood Creek Indian. Certain funds, said to have been [295 U.S. 418, 419] derived from his restricted allotment, in excess of his needs were invested. The proceeds therefrom were collected and held in trust under direction of the Secretary of Interior. The question now presented is whether this income was subject to the federal tax laid by the 1928 Revenue Act (chapter 852, 11, 12, 45 Stat. 791, 26 USCA 2011, 2012). The Commissioner, the Board of Tax Appeals, and the court below answered in the affirmative.
Petitioner maintains that the court should have followed the rule which it applied in Blackbird v. Commissioner (C.C.A.) 38 F.(2d) 976, 977; also that it erroneously held Congress intended to tax income derived from investment of funds arising from restricted lands belonging to a full- blood Creek Indian.
The court below properly declined to follow its quoted pronouncement in Blackbird's Case. The terms of the 1928 Revenue Act are very broad, and nothing there indicates that Indians are to be excepted. See Irwin v. Gavit, 268 U.S. 161 , 45 S.Ct. 475; Heiner v. Colonial Trust Co., 275 U.S. 232 , 48 S.Ct. 65; Helvering v. Stockholms, etc ., Bank, 293 U.S. 84 , 55 S.Ct. 50; Pitman v. Commissioner (C. C.A.) 64 F.(2d) 740. The purpose is sufficiently clear.
The general terms of the taxing act include the income under consideration and if exemption exists it must derive plainly from agreements with the Creeks or some act of Congress dealing with their affairs.
Neither the Creek agreement of 1901 (31 Stat. 861), nor the Supplemental Agreement of 1902 (32 Stat. 500), conferred general exemption from taxation upon Indians; homesteads only were definitely excluded, although alienation of allotted lands was restricted.
We find nothing in either act which expresses definite intent to exclude from taxation such income as that here involved. See Shaw v. Gibson-Zahniser Oil Corp., 276 U.S. 575, 581 , 48 S.Ct. 333.
Nor can we conclude that taxation of income from trust funds of an Indian ward is so inconsistent with that relationship that exemption is a necessary implication. Non-taxability and restriction upon alienation are distinct things. Choate v. Trapp, 224 U.S. 665, 673 , 32 S.Ct. 565. The taxpayer here is a citizen of the United States, and wardship with limited power over his property does not, without more, render him immune from the common burden.
Shaw v. Gibson-Zahniser Oil Corp., supra, held that restricted land purchased for a full-blood Creek-ward of the United States-with trust funds was not free from state taxation, and declared that such exemption could not be implied merely because of the restrictions upon the Indian's power to alienate.
[ Footnote 1 ] Like provisions are in sections 210 and 211(a), Revenue Acts 1921, 1924, 1926 (26 USCA 951, 952 notes), and sections 11 and 12(a), Revenue Act 1928 (26 USCA 2011, 2012(a); section 213(a), Revenue Acts 1921, 1924, 1926 (26 USCA 954(a) and note), and section 22, Revenue Act 1928 ( 26 USCA 2022).

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