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AGO 1950 No. 395 - December 01, 1950
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Smith Troy | 1941-1952 | Attorney General of Washington


Personal property of a partnership composed of an Indian and a white man, including property which Indian has effectively contributed to the partnership, is subject to taxation, although such property is located on an Indian Reservation.

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                                                                December 1, 1950

Honorable D. E. Harper
Prosecuting Attorney, Clallam County
205 Kuppler Building
Port Angeles, Washington                                                                                                              Cite as:  AGO 49-51 No. 395

Attention:  !ttNathan G. Richardson
            Deputy Prosecuting Attorney

Dear Sir:

            By letter of August 15, 1950, you requested our opinion on the question:

            "Can the county assessor assess an Indian's half of partnership property located on an Indian Reservation, for a personal property tax?"

            You state that in the situation involved the Indian is in partnership with a white man in the operation of a fish company on the Indian Reservation at Neah Bay, Washington.  By letter of September 29, 1950, in response to our request for further information, you indicate that the partnership is based on a formal written agreement which is filed and registered with the Secretary of State.  In addition to the foregoing facts, we assume that the Indian's property has been regularly and effectively contributed and transferred to the partnership by and with the authority and consent of the proper United States governmental authority.

            Our conclusion may be stated as follows:

             [[Orig. Op. Page 2]]

            Where an Indian under proper United States governmental authority, has regularly and effectively contributed personal property to a partnership entity composed of himself and a white man, the county assessor may levy an assessment for personal property taxes on the personal property of the partnership, including that contributed by the Indian, although such property is located on an Indian Reservation.


            The question of whether the personal property of an Indian living on an Indian Reservation is subject to personal property taxes depends upon the circumstances under which the Indian acquired such property.  The rule is that property which is traceable and identifiable as property issued to an Indian by the United States and, generally speaking, the increase thereof, and property substituted therefor, is exempt from taxation, Olney v. McNair, 105 Wash. 18, 177 Pac. 641.  Property which cannot be so traced and identified is not taxable.  U. S. v. Pearson, 231 Fed. 270.

            We do not have the details as to the circumstances surrounding the acquisition by the Indian of the property contributed by him to the partnership.  If, however, such property originally could have been traced and identified as restricted property which would ordinarily be exempt from taxation, an effective transfer of such property to the partnership (which we have here assumed to be the fact) would include consent to, and authorization for, such transfer by the proper representative of the United States Department of the Interior having jurisdiction over the Indians on the Reservation involved.

            We are of the opinion that an effective transfer of such property to the partnership entity extinguishes the interest of the Indian in that specific property and removes the exemption from taxation, even if such exemption did, in fact, previously exist.

            The property of a partnership belongs to the partnership entity and not to the partners individually.  40 Am. Jur. 202, Partnership, § 107; Kittilsby v. Vevelstad, 103 Wash. 126, 129, 173 Pac. 744.  Recognition of the status of a partnership as a separate entity in its relation to the personal property owned by the firm is found in the Uniform Partnership Act, chapter 137, Laws of 1945 (§ 9975-40 et seq. Rem. Supp. 1945) and in the statutory provisions for the listing of personal property for assessment purposes, section 15, chapter 130, Laws of 1925, Ex. Sess. (Rem. Rev. Stat. 11119).

             [[Orig. Op. Page 3]]

            Property otherwise taxable is not exempt by virtue of the fact that it is located on an Indian Reservation.  Thomas v. Gay, 169 U.S. 264; Wagner v. Evans, 170 U.S. 588.

            As above indicated, our conclusion is based upon the assumption that even if the property contributed to the partnership by the Indian was, prior to such contribution, traceable and identifiable as tax exempt property, there has been an effective transfer to the partnership entity, which transfer includes any necessary consent and approval by the proper representative of the United States Department of the Interior.

Very truly yours,

Attorney General

Assistant Attorney General

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