[Congressional Bills 118th Congress] [From the U.S. Government Publishing Office] [H.R. 8318 Introduced in House (IH)] <DOC> 118th CONGRESS 2d Session H. R. 8318 To amend the Internal Revenue Code of 1986 to treat Indian Tribal Governments in the same manner as State governments for certain Federal tax purposes, and for other purposes. _______________________________________________________________________ IN THE HOUSE OF REPRESENTATIVES May 8, 2024 Ms. Moore of Wisconsin (for herself, Mr. Schweikert, Mr. Kildee, Mr. Kelly of Pennsylvania, Ms. DelBene, Mr. Cole, Mr. Kilmer, and Mr. Moolenaar) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Education and the Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned _______________________________________________________________________ A BILL To amend the Internal Revenue Code of 1986 to treat Indian Tribal Governments in the same manner as State governments for certain Federal tax purposes, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE; TABLE OF CONTENTS. (a) Short Title.--This Act may be cited as the ``Tribal Tax and Investment Reform Act of 2024''. (b) Table of Contents.--The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Findings. Sec. 3. Treatment of Indian tribes as States with respect to excise taxes and bond issuance. Sec. 4. Treatment of pension and employee benefit plans maintained by Tribal Governments. Sec. 5. Treatment of Tribal foundations and charities like charities funded and controlled by other governmental funders and sponsors. Sec. 6. Improving effectiveness of Tribal child support enforcement agencies. Sec. 7. Recognizing Indian tribal governments for purposes of determining under the adoption credit whether a child has special needs. Sec. 8. New markets tax credit for tribal area investments. Sec. 9. Inclusion of Indian areas as difficult development areas for purposes of certain buildings. Sec. 10. Tribal general welfare and trust programs clarification. Sec. 11. Indian employment tax credit. Sec. 12. Exclusion from gross income for payments under Indian health service loan repayment program. Sec. 13. Exclusion of certain amounts received under Indian Health Professions Scholarships Program. SEC. 2. FINDINGS. The Congress finds the following: (1) There is a unique Federal legal and political relationship between the United States and Indian Tribes. (2) Indian Tribes have the responsibility and authority to provide governmental programs and services to Tribal citizens, develop Tribal economies, and build community infrastructure to ensure that Indian reservation lands serve as livable, permanent homes. (3) The United States Constitution, United States Federal Court decisions, Executive orders, and numerous other Federal laws and regulations recognize that Indian Tribes are governments, retaining the inherent authority to tax and operate as other governments, including (inter alia) financing projects with government bonds and maintaining eligibility for general tax exemptions via their government status. (4) Codifying tax parity with respect to Tribal Governments is consistent with Federal treaties recognizing the sovereignty of Tribal Governments. (5) That Indian Tribes face historic disadvantages in accessing the underlying capital to build the necessary infrastructure for job creation, and that certain statutory restrictions on Tribal governance further inhibit Tribes' ability to develop strong governance and economies. (6) Indian Tribes are sometimes excluded from the Internal Revenue Code of 1986 in key provisions which results in unfair tax treatment for Tribal citizens or unequal enforcement authority for Tribal enforcement agencies. (7) Congress is vested with the authority to regulate commerce with Indian Tribes, and hereby exercises that authority in a manner which furthers Tribal self-governance, and in doing so, further affirms the United States government- to-government relationship with Indian Tribes. SEC. 3. TREATMENT OF INDIAN TRIBES AS STATES WITH RESPECT TO EXCISE TAXES AND BOND ISSUANCE. (a) Repeal of Essential Governmental Function Requirements.-- Section 7871 of the Internal Revenue Code of 1986 is amended by striking subsections (b) and (e) and redesignating subsections (c), (d), and (f) as subsections (b), (c), and (d), respectively. (b) Special Rules for Tax-Exempt Bonds.--Subsection (b) of section 7871 of such Code, as redesignated by subsection (a), is amended to read as follows: ``(b) Special Rules for Tax-Exempt Bonds.-- ``(1) In general.--In applying section 146 to bonds issued by Indian Tribal Governments, the Secretary shall annually-- ``(A) establish a national bond volume cap based on the greater of-- ``(i) the amount determined under section 146(d)(1)(A), determined by substituting `the national Tribal population estimates supplied annually by the Secretary of the Interior, as measured by the total number of enrolled Tribal citizens of each tribe'for `State population', and ``(ii) the minimum State ceiling amount in section 146(d)(1)(B) (as adjusted in accordance with the cost of living provision in section 146(d)(2)), and ``(B) under regulations prescribed by the Secretary, allocate such national bond volume cap among all Indian Tribal Governments seeking such an allocation in a particular year. ``(2) Application of geographic restriction.--In the case of national bond volume cap allocated under paragraph (1), section 146(k)(1) shall not apply to the extent that such cap is used with respect to financing for a facility located on qualified Indian lands. ``(3) Restriction on financing of certain gaming facilities.--No portion of proceeds from an obligation issued by an Indian Tribal Government (or subdivision thereof) under section 103 may be used with respect to the financing of any portion of a building in which class II or class III gaming (as defined in section 4 of the Indian Gaming Regulatory Act (25 U.S.C. 2703)) is conducted or housed or any property actually used in the conduct of such gaming. ``(4) Definitions and special rules.--For purposes of this subsection-- ``(A) Indian tribal government.--The term `Indian Tribal Government' means the recognized governing body of any Indian or Alaska Native tribe, band, nation, pueblo, village, community, component band, or component reservation, individually identified (including parenthetically) pursuant to section 104 of the Federally Recognized Indian Tribe List Act of 1994 (25 U.S.C. 5131). ``(B) Intertribal consortia, etc.--Under regulations prescribed by the Secretary, an Indian Tribal Government (or a partnership of Indian Tribal Governments) may authorize an intertribal consortium, an organization, or an Alaska Native regional or village corporation, as defined in, or established pursuant to, the Alaska Native Claims Settlement Act, to plan for, coordinate or otherwise administer services, finances, functions, or activities on its behalf under this subsection, except that the authorized entity shall have the rights and responsibilities of the authorizing Indian Tribal Government (or Indian Tribal Governments) only to the extent provided in the authorizing resolution. ``(C) Qualified indian lands.--The term `qualified Indian lands' means-- ``(i) Indian lands within the meaning of section 29(j)(8) of the Stevenson-Wydler Technology Innovation Act of 1980 (15 U.S.C. 3722b(j)(8)), ``(ii) land held in fee simple by an Indian Tribal Government, ``(iii) land held by incorporated Native groups, regional corporations, and village corporations under the provisions of the Alaska Native Claims Settlement Act (43 U.S.C. 1601 et seq.), ``(iv) Hawaiian Home Lands (as defined in section 801 of the Native American Housing Assistance and Self-Determination Act of 1996 (25 U.S.C. 4221), and ``(v) under regulations prescribed by the Secretary, lands where the facility is to be placed in service in connection with-- ``(I) the active conduct of a trade or business by an Indian Tribe on, contiguous to, within reasonable proximity of, or with a substantial connection to lands described in clause (i), (ii), (iii), or (iv), or ``(II) infrastructure (including roads, power lines, water systems, railroad spurs, and communication facilities) serving lands described in clause (i), (ii), (iii), or (iv).''. (c) Conforming Amendments.-- (1) Section 7871(a) of such Code is amended-- (A) in paragraph (2) by striking ``subject to subsection (b),'', and (B) in paragraph (4) by striking ``subsection (c)'' and inserting ``subsection (b)''. (2) Subparagraph (B) of section 45(c)(9) of such Code is amended to read as follows: ``(B) Indian tribe.--For purposes of this paragraph, the term `Indian Tribe' means any Indian Tribe, band, nation, or other organized group or community which is recognized as eligible for the special programs and services provided by the United States to Indians because of their status as Indians.''. (d) Effective Date.-- (1) Tax-exempt bonds.--The amendments made by this section shall apply to obligations issued in calendar years beginning after the date of the enactment of this Act. (2) Excise taxes.--The amendments made by this section with respect to any excise tax referred to in section 7871(a)(2) of such Code shall take effect on and after the first day of the first calendar quarter beginning more than 60 days after the date of the enactment of this Act. SEC. 4. TREATMENT OF PENSION AND EMPLOYEE BENEFIT PLANS MAINTAINED BY TRIBAL GOVERNMENTS. (a) Amendments to the Internal Revenue Code of 1986.-- (1) Qualified public safety employee.--Section 72(t)(10)(B) of the Internal Revenue Code of 1986 (defining qualified public safety employee) is amended by-- (A) striking ``or political subdivision of a State'' and inserting ``, political subdivision of a State, or Indian tribal government''; and (B) striking ``such State or political subdivision'' and inserting ``such State, political subdivision, or Indian tribal government''. (2) Governmental plan.--The last sentence of section 414(d) of such Code (defining governmental plan) is amended to read as follows: ``The term `governmental plan' includes a plan established or maintained for its employees by an Indian tribal government, an agency, instrumentality, or subdivision of an Indian tribal government, or an entity established under Federal, State, or Tribal law which is wholly owned or controlled by any of the foregoing.''. (3) Exempt governmental deferred compensation plan.-- Section 3121(v)(3) of such Code (defining governmental deferred compensation plan) is amended by inserting ``by an Indian tribal government, an agency, instrumentality, or subdivision of an Indian tribal government, or an entity established under Federal, State, or Tribal law which is wholly owned or controlled by any of the foregoing,'' after ``political subdivision thereof,''. (4) Grandfather of certain deferred compensation plans.-- Section 457 of such Code is amended by adding at the end the following new subsection: ``(h) Certain Tribal Government Plans Grandfathered.--Plans established before the date of enactment of this subsection and maintained by an Indian tribal government, an agency, instrumentality, or subdivision of an Indian tribal government, or an entity established under Federal, State, or Tribal law which is wholly owned or controlled by any of the foregoing, in compliance with subsection (b) shall be treated as if established by an eligible employer under subsection (e)(1)(A). Such plans may be maintained in compliance with section 457 or may be converted to or merged into a section 401(k) cash or deferred arrangement maintained by such government, agency, instrumentality, subdivision, or entity.''. (5) Long-term, part-time workers.--Section 401(k)(15)(C) of such Code is amended to read as follows: ``(C) Application of standards to certain employees and plans.--The provisions of paragraph (2)(D)(ii) shall not apply to-- ``(i) employees described in section 410(b)(3), and ``(ii) a governmental plan within the meaning of section 414(d)).''. (b) Enforcement Moratorium Related to Pension Protection Act of 2006.-- (1) In general.--No Indian tribal government, an agency, instrumentality, or subdivision of an Indian tribal government, or an entity established under Federal, State, or Tribal law which is wholly owned or controlled by any of the foregoing, shall be subject to a Federal agency enforcement action based on changes under the Internal Revenue Code of 1986 or Employee Retirement Income and Security Act of 1974 enacted under the Pension Protection Act of 2006, for any periods prior to the publication of agency regulations thereunder. (2) Indian tribal government.--For purposes of this subsection, the term ``Indian tribal government'' has the meaning given such term in section 7701(a)(40) of the Internal Revenue Code of 1986. (3) Regulatory guidance.--The Secretary shall work with the Tribal Advisory Committee established pursuant to section 3 of the Tribal General Welfare Exclusion Act of 2014, and in consultation with Indian tribal governments and relevant governmental agencies, to develop regulatory guidance under this section. (c) Uniform Protections and Fiduciary Standards for Tribal Plans.-- (1) In general.--Chapter 77 of such Code is amended by adding at the end the following: ``SEC. 7531. UNIFORM PROTECTIONS AND FIDUCIARY STANDARDS FOR TRIBAL PENSION PLANS. ``(a) In General.--A Tribal pension plan shall be subject to the uniform protections and fiduciary standards for Tribal pension plans. ``(b) Personal Liability.-- ``(1) In general.--Any person who is a fiduciary with respect to a Tribal pension plan who breaches any of the responsibilities, obligations, or duties imposed upon fiduciaries by the uniform protection and fiduciary standards for Tribal pension plans, shall be personally liable to make good to such plan any losses to the plan resulting from each such breach, and to restore to such plan any profits of such fiduciary which have been made through use of assets of the plan by the fiduciary, and shall be subject to such other equitable or remedial relief as the court may deem appropriate, including removal of such fiduciary. ``(2) No liability for prior breach.--No fiduciary shall be liable with respect to a breach of fiduciary duty under this section if such breach was committed before the fiduciary became a fiduciary or after the fiduciary ceased to be a fiduciary. ``(c) Nondiscrimination.-- ``(1) No interference with protected rights.--It shall be unlawful for any person to discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary for exercising any right to which the participant or beneficiary is entitled under the provisions of a Tribal pension plan or under the uniform protection and fiduciary standards for Tribal pension plans, or for the purpose of interfering with the attainment of any right to which such participant or beneficiary may become entitled under such plan or the uniform protection and fiduciary standards for Tribal pension plans. ``(2) Nondiscrimination.--Contributions or benefits provided under a Tribal pension plan shall not discriminate in favor of highly compensated employees (within the meaning of section 414(q)). ``(d) Definitions and Special Rules.--For purposes of this section-- ``(1) Tribal pension plan.--The term `Tribal pension plan' means any qualified employer retirement plan (as defined in section 72(d)(1)(G)) which-- ``(A) is a governmental plan (as defined i