Tuesday, April 13, 2010

Illegal Taxation of Native American Service Members

Illegal Taxation of Native American Service Members
Posted by: "MIKE Graham"
Mon Apr 12, 2010 1:23 pm (PDT)

At this time we are trying to get Okla Congressman Born & NM Congressman
Ben Lujan to reintroduce a bill in the house, working the issue state by
state is not working.

Illegal Taxation of Native American Service Members

Please forward to appropriate Departments:

During the 108th Congress, Representative Udall of New Mexico introduced
H. R. 5275 “The American Indian Veterans Pay Restoration Act of 2004.” This
bill was introduced to rectify a mistake by the Department of Defense in
the collection and distribution of state income taxes for Native American
Service Members on active duty prior to 2001 and who were domiciled on Indian

This bill was introduced to the House of Representatives on October 7,
2004, and was immediately referred to the House Committee on Armed Services
with introductory remarks made by Representative Udall. Since that day, no
action has been taken on this important piece of Legislation.

Mr. Udall stated “Prior to 2001, Native Americans who served their country
in the armed forces had their active duty pay taxed by the state, despite
claiming the reservation as their home. The law is now well established
that this policy was wrong and, in keeping with tribal sovereignty, the policy
of withholding states taxes on these soldiers' pay was changed. This
position is reflected in administrative opinions, Fatt v. Utah, 884 P2d 1233
(Utah 1994), a 2000 Department of Justice (DOJ) opinion, a Department of
Defense (DOD) policy instituted in 2001, and most recently, in Public Law
108-189, a law that passed this House unanimously.

However, while these changes stopped the improper practice of withholding
taxes, the changes do not apply retroactively. Current federal law provides
that statutes of limitations toll during a member's service, but the
ability to recover withheld taxes is still limited by state statute of
limitations on filing for refunds. The result is that hundreds, or perhaps
thousands, of tribal members whose state taxes were improperly withheld during their
service to our country are unable to recover the money that is owed to

We hereby Petition the Congress of the United States to rectify this
situation by reintroduction and swift passage of a bill that would refund the
state tax monies due to those Native American Service Members who were
illegally taxed.

Sign the petition:

New Mexico Department of Veterans’ Services
On December 1, 2009, the state of New Mexico started the process of
refunding any state income tax which may have been withheld from the paychecks of
Native American military personnel who were legally domiciled on tribal
land in New Mexico while serving in the U.S. Armed Forces.
Governor Bill Richardson signed into law the Native American Veterans’
Income Tax Settlement Fund to pay for any refunds to eligible Native American
soldiers or veterans. These refunds will be made on a “first come, first
served” basis and will continue until the Fund is exhausted, until no further
claims are received, or until the Fund expiration date of January 1, 2013
(December 31, 2012 is the last day to file a claim.)
Any Native American veteran or soldier, their widow, or the legally
recognized executor/administrator of a deceased Native American veteran’s estate
who believes they qualify for a Native American Veterans’ Income Tax
settlement may file a claim with the state of New Mexico.
The process starts by filling out a claim form with the New Mexico
Department of Veterans’ Services. This claim form can be found here or down below.
Each form must be completed, signed, and accompanied by a copy of a Veteran
’s DD-214 form or other official Department of Defense form proving an
applicant’s veteran status.
This packet should then be mailed to:
New Mexico Department of Veterans’ Services
Alan Martinez, Deputy Secretary
PO Box 2324
Santa Fe, NM 87504-2324
Full report and Information page:
Native American veterans speak out about state tax's being withheld from
their military pay:
I was in a foxhole too. I realize most folks would agree that everyone
should pay taxes and I agree with that.When Native American Indians were
forced to move and put on reservations the government established laws for these
reservations and tribes. The states were limited on their ability to
interfere with tribal affairs including taxes.

Native American Veterans were illegally taxed while serving in the armed
forces of the united states. A federal law was passed in 1940 to protect all
military members from being treated unfairly while they were away from
their homes serving in the military.

According to section 514 of this law (SSCRA of 1940) Native American
military pay shall not be taxed by the states tax laws but by their own tribes
tax laws.

Every state that deducted income taxes violated this federal law and
cheated Native Americans out of money. All Americans especially those in
public office should recognize that states ignored this law and in doing so they
illegally took money from veterans!

This law was established back in 1940 and the only state to admit to its
error was New Mexico. The state of New Mexico has agreed to pay back this
stolen money with interest to the native veterans of that state.

Anyone who knows a veteran or knew a veteran should be ashamed of the
treatment that these cheated warriors have gone through. Stand up and tell
everyone that all states should pay back this stolen money.

Richard Adame
Praire Band Potawatomi/U.S. Army
Mayetta, Kansas

Indian Country News:

Veteran letter sent to me:

Native American Veterans Deserve Equal Treatment

I am just a Native American retired army veteran who has a story to tell.
It concerns the taxes that most states deducted from the military pay of
Indian Veterans. The story is not new but very few know of it. All these
veterans deserve this money be returned.

The SSCRA of 1940 was a federal law put in place to protect all
servicemen and their property from unfair and shady mistreatment while they wee away
from their homes serving in the military.

A section of this act specifically prohibited states from imposing an
income tax on the military wages of Native American Indian veterans if these
veterans claimed Indian Lands as there homes when they joined up. Everyone
knows that if Indians work and live on the reservations or tribal trust lands
that they do not pay state and local taxes. The SSCRA states that Tribal
veterans will be taxed as if they were still on tribal trust lands.

Even though this federal law was enacted in 1940 our relatives who served
in the armed forces were illegally taxed by the state their tribe was
located in. The SSCRA mentioned double taxation but DD 2058 ( state of legal
residence certificate to determine the correct state of legal residence for
purposes of withholding state income tax from military pay) was not
available until 1977. This means that states were not only taxing military pay but
double taxing in some cases. State governments run off of income taxes. If
a veteran happened to be stationed and earning wages in more than one state
in a tax period they were undoubtedly taxed by all states involved.

DD form 2058 was invented in 1977 to stop this illegal double taxation
however their was no mention of the illegal taxation that states were
deducting from the pay of Native American Indian veterans. These tribal veterans by
law were exempt from any state income tax because they did not lose their
tribal trust taxation status simply by leaving the tribal lands to comply
with military orders. A separate form DD 2058-2(specifically for Native
Americans), was not introduced by the department of defense until July of
2002. This form when signed exempted Indian veterans from state income taxes.

Native American Veterans were always exempt from state income taxes
through countless treaties with the United States government and the SSCRA of

A bill HR 5275 ,The Native American veteran Pay restoration Act ,was
introduced into the 108th congress to correct this mistreatment and repay these
veterans but it went nowhere and was never heard of again.

Simply by introducing this bill the government admits to this broken
promise and illegal act .Thousands of veterans deserve that this money be

UNA Veterans page:

Forward by: _www.UnitedNativeAmerica.com_

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