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Tax Cuts and Jobs Act

Provision 13821

Modification of Tax Treatment of Alaska Native Corporations and Settlement Trusts

Overview

Introduction

The Tax Cuts and Jobs Act of 2017 (TCJA) modified the tax treatment Alaska Native Corporations and Alaska Settlement
Trusts by adding new Codes §§ 139G and 247 and revising the reporting requirements of § 6039H.

Native Corporations and Settlement Trusts, as well as their shareholders and beneficiaries, generally are subject to tax
under the same rules and in the same manner as other taxpayers that are corporations, trusts, shareholders, and

beneficiaries. These new provisions allow a Native Corporation to assign certain payments to a Settlement Trust without
having to recognize gross income and to elect to deduct contributions made to a Settlement Trust. A Settlement Trust

must include in gross income the assigned payments and the contributions received from the Native Corporation.
Collectively, the provisions eliminate corporate tax on income transferred to the trust.

New § 139G allows a Native Corporation to assign certain payments to a Settlement Trust without having to recognize

gross income from those payments. The Settlement Trust is required to include the assigned payment in income when
received.

73233-102 13821-1 Tax Cuts and Jobs Act