§ 564j. Taxes; initial exemption; taxes following distribution; valuation for capital gains or losses

No property distributed under the provisions of this subchapter shall at the time of distribution be subject to Federal or State income tax. Following any distribution of property made under the provisions of this subchapter, such property and any income derived therefrom by the individual, corporation, or other legal entity shall be subject to the same taxes, State and Federal, as in the case of non-Indians: Provided, That, for the purpose of capital gains or losses the base value of the property shall be the value of the property when distributed to the individual, corporation or other legal entity.

(Aug. 13, 1954, ch. 732, § 11, 68 Stat. 721.)

Miscellaneous

All Amounts Realized From Condemnation of Certain Forest Lands Held in Trust

Pub. L. 94–81, § 1, Aug. 9, 1975, 89 Stat. 417, as amended by Pub. L. 96–596, § 5(a), Dec. 24, 1980, 94 Stat. 3476; Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided: “That, for purposes of the Internal Revenue Code of 1986 [formerly I.R.C. 1954, Title 26, Internal Revenue Code], all amounts realized by the trust from the condemnation, pursuant to Public Law 93–102 [section 564w–2 of this title], of the Klamath Indian forest lands held by the trustee for the Klamath Indian Tribe—

“(1) shall be excluded from the gross income of the trust, and

“(2) on the distribution from the trust of the proceeds of such condemnation, shall be excluded from the gross income of each person receiving such distribution.”

Pub. L. 96–596, § 5(b), Dec. 24, 1980, 94 Stat. 3476, provided that: “The amendment made by subsection (a) [amending section 1 of Pub. L. 94–81, set out above] shall apply to all amounts whether received before, on, or after the date of the enactment of this Act [Dec. 24, 1980].”