Estate of Robert Poletti, Deceased Labarbara T. Poletti, Personal Representative Labarbara T. Poletti v. Commissioner, Internal Revenue Service

LaBarbara Poletti (“Petitioner”) is a mixed-blood Ute Indian who in 1983 received from the Ute Distribution Corporation (“UDC”) distributions of monies generated by oil, mineral, and gas production on the Ute Indian Reservation. Representing herself and the estate of her late husband, Robert Poletti, Petitioner appeals the decision of the tax court which found that the distributions received by Petitioner were taxable and upheld the deficiency in income tax due determined by the Commissioner of Internal Revenue. Because we find that the tax court correctly found the distributions taxable, we affirm.

I. FACTS

The Ute Partition Act of 1954 (“UPA”) was one of a series of statutes enacted during the 1950s to reduce federal involvement in Indian affairs. Enacted in response to proposals initiated by the Ute Tribe of Indians in Utah, UPA’s purposes were: (1) “to provide for the partition of the assets of the Ute Indian Tribe of the Uintah and Ouray Reservation in Utah between the mixed-blood and full-blood members thereof’; (2) “for the termination of Federal supervision over the trust, and restricted property, of the mixed-blood members of said tribe”; and (3) “for a development…