Resident tribal members entitled to tax benefits
Sault Tribe members living in and around the tribe’s service area have been enjoying tax benefits since April 2003. The state of Michigan signed a tax agreement that benefits many members whose principal residence is within specific agreement areas which is often on or near tribal reservations.
Those members living in the agreement area are exempt from state income tax. They also receive state tax discounts on many purchases. The agreement applies to the Michigan sales tax (6% of retail price), use tax (6% of purchase price), motor fuel tax, cigarette tax and the single business tax.
Members are also entitled to an annual income tax refund check, which is 4 percent of adjusted gross income, and must be filed when filing your income taxes. (Use tax form 4013.)
Those members who do not live in the agreement area are not eligible to receive sales tax discounts, tax exemptions, or income tax refund. However, they can receive gas, diesel, and cigarette tax discounts at certain retail stores located in the agreement area. Fuel and cigarette tax discounts are realized at the time of purchase.
Tribal members in the tax agreement area must request a tax exemption certificate BEFORE a purchase that would entitle a tribal member to a Michigan sales tax exemption.
If you are 16 or over and want to receive these tax benefits, you must sign a Sault Tribe tax agreement registration card to verify your residency in an agreement area.
Before you can request an annual tax refund or tax exemption, you must first sign and return a registration card to the Sault Tribe tax office to verify your residency in a tax agreement area. This is mandatory for all tribal members.
If you are unsure you are registered, please call the tax office and Candace Blocher at (906) 632-6281 or toll free, (866) 632-62811, to verify your card is on file. Once registered, members are then required to fill out a certain tax forms and submit them to the state or tribe’s tax office.
It is the member’s responsibility to notify the tribal tax office when they change addresses, even if the address change is still in the agreement area. Please note, if you have move out of the tax agreement area and are still receiving certain tax benefits, or exemptions through this agreement, it may be considered tax fraud. Please consult your personal accountant or call the tribal tax office for questions. Members are responsible for complying with the agreement and are encouraged to contact the Sault Tribe Tax Office with any questions about any of its provisions.
Tax Agreement Maps and the Tribal-State Tax Agreement are available for download: