IRS Auctions off Sioux land to pay back taxes


Okay, I know this story is a few days old, but it amazes me that this day in age we are still taking things from the Indians . . .

Posted by Ahni on December 4, 2009 at 4:01pm

The Internal Revenue Service (IRS) has auctioned off 7,100 acres of land belonging to the Crow Creek Sioux Tribe in central South Dakota, one of the most impoverished reservations in the United States.

The land was sold on Thursday in a bold but hardly shocking attempt by the IRS to recover $3.1 million in federal employment taxes, penalty charges and interest that was owed by the Tribe.

According to a recent lawsuit filed by the tribe, the IRS acted unlawfully because the land is owned by Crow Creek Tribal Farms Inc., a corporation formed under Tribal law.

The lawsuit further contends that the Bureau of Indian Affairs (BIA) misinformed the tribe, telling them “that, because it was a federally recognized Tribe, it was not necessary to pay federal employment taxes.”

“It’s very disgraceful, very shameful. It’s devastating to us,” said Tribal Chairman Brandon Sazue, who was in attendance at the auction. “Our land is never for sale.”

In addition to this, the land is a part of the Crow Creek Indian Reservation, which was established by the 1868 Treaty of Fort Laramie.

Just prior to the treaty, in 1863, the US government established Fort Thompson some eight miles from the Crow Creek tributary in South Dakota. Fort Thompson was a military-controlled site, which also served as a prison camp following the 1862 mass hanging of 38 Dakota warriors. Rarely mentioned in history books, it was the “largest public mass execution in American history.”

The site became occupied by descendants from several members of the Lakota, Nakota, and Dakota Sioux, who eventually came to refer to themselves as “Hunkpati” (the making of relatives, to live).

When the 1868 Treaty was signed, it brought the reservation into Trust Status. However, the United States government honored the treaty for just six years, until General George A. Custer arrived with the 7th Cavalry to try and capture the Black Hills. The invasion ultimately led to the 1876 Battle of Little Big Horn.

One year later, the US Government unilaterally granted itself title to the Black Hills through the Allotment Act of 1877. Also known as the “Sell or Starve Bill,” the act further divided Sioux lands into individual plots of land which were then handed out to Sioux males .

In 1889, the government took things even further, by removing Crow Creek from its Trust status and selling plots of lands to non-Indians. A 7,100 acre swath was purchased by LeMasters, who held onto the land until Crow Creek Tribal Farms bought it from them in 1998

The company bought the land to consolidate the Tribes land base, explains the lawsuit, and to ultimately ensure an economic future for the tribe. Crow Creek, like other every other reservations in the region, is considered to be a prime location to make renewable energy from the wind.

The reservation isn’t willing to give up the hope. Not when the alternative is abject poverty.


#1 Plaintiff Guy on 12.09.09 at 11:12 am

Tribal members acquired this land as a corporation, not as part of the reservation. It’s private and not part of a treaty. A few native americans (not the tribe) own the corporation. This trick (tax evasion) has been going on in New York state. It’s given native americans unfair agri-business advantage. Tribal organizations have chosen here for a face off because they (falsely) believe it will become part of the reservation. It’s grassland with little potential so it looks like another white man land grab. Basically, it’s a method for a few individuals to gain land wealth with separate non-taxable status.

#2 Costner on 12.09.09 at 12:01 pm

What PG said. Maybe the “tribal corporation” should just pay their taxes and quite whining about it.

#3 l3wis on 12.09.09 at 3:36 pm

I just think it is extremely strange that one of the poorest counties in the Nation is being raided by the IRS for back taxes. Kind of sounds like an oxymoron to me.

#4 l3wis on 12.10.09 at 6:39 am

Look at this article;

#5 Costner on 12.10.09 at 11:53 am

Two different issues at play here Lewis. The land auctioned by the IRS wasn’t tribal land – it was privately held and the tribal corporation bought it in the late 90s from a private owner.

They then proceeded to ignore those pesky tax bills while turning a profit from the land itself. It isn’t like the IRS is taking tribal land here, and in this case the tribe is acting in the same capacity as any large farm that acts as a corporation.

The difference is… the tribe doesn’t know how to hire a qualified accountant, and they expect public sympathy when the IRS comes knocking expecting to be paid.

On the inverse – if we give tribal corporations a free pass on paying taxes, they would have a significant advantage over their non-tribe counterparts and could soon obtain huge tracts of land. Not only would this reduce the tax base for surrounding areas, but it would result in lower costs to the tribe which could then be passed along as lower mineral, oil, or grazing costs.

There comes a point when the tribes need to just integrate with the US. Either that or we just give them North Dakota, put up a fence, cut off all government assistance and call it a day…. their choice.

#6 anominous on 12.10.09 at 3:49 pm

Word is…they gonna ship ye back to Hayes, and when ye get there…they gonna hang ye.

#7 l3wis on 12.10.09 at 4:06 pm

I have often said the solution is to get rid of the reservations and give the indians back their land. It would be like ripping off a bandaid but the best solution.

#8 Costner on 12.11.09 at 8:11 am

So which “Indians” do you give the land too? They would claim the entire nation as their own, and you can’t determine boundaries since they were a nomadic people. They also had generations of fighting between tribes so you would have half a dozen claiming ownership over the same pieces of the pie.

I’m all for giving them the land they currently hold and just walking away, but I’ll be damned if I would meet all of their demands such as their claim they own the black hills and everything within a 400 mile radius of the badlands.