Tribal Land Transfer or Individual Ownership of Reservation Land

The General Allotment Act of 1887 divided American Indian treaty lands into individually owned parcels of land known as allotments. Also known as The Dawes Act, Native Americans who were registered with the tribe were granted land. The head of the family received one-quarter of a section, single individuals over eighteen received one-eighth of a section, and individuals under eighteen received one-sixteenth of a section.

Types of Native American Land

There are two major types of Native American land. Trust land is held by the federal government, but the beneficial interest remains with the individual or tribe. Trust lands held on behalf of individuals are known as allotments. The second type is Fee land is purchased by tribes, the tribe acquires legal title under specific statutory authority. Generally, most Native American lands are Trust land. Ownership can be a combination of trust lands and fee lands on one or more reservations.

Individually Owned Trust or Restricted Land

The Individual Trust Interest (ITI) Report will indicate the type of land ownership. This document should be kept in a safe place to prove ownership and for estate planning. When the original allottee was deceased, ownership was and has continued to be distributed among their heirs as undivided interests. Any undivided interest in allotted land is held in trust by the United States for the benefit of its Indian owner. Individually owned trust and restricted lands are not subject to any type of city, county, state or federal taxes such as property taxes. Most financial institutions do not accept an undivided interest in Trust lands as collateral for a loan. Community Development Financial Institution (CDFI) will work with Trust lands as collateral to allow Native Americans to leverage their land.

Under the technical amendment of December 2, 2008, Indian Reorganization Act (IRA) tribes have been given the authority to enact resolutions, codes, or laws to permit owners the ability to write a will and leave trust property to a non-Indian person and have the land converted from trust status to fee status. Without tribal resolution, the American Indian Probate Reform Act (AIPRA) prohibits the leaving of IRA lands in fee to a non-Indian. Non-IRA tribes already had this authority.

This may be affected by technical amendments allowing IRA tribes to pass a tribal law allowing trust lands to be willed into fee status.

Passing of trust and restricted land

Upon an owner’s passing, individually owned trust or restricted land passes in one of two ways:

  • If the owner has a written will, he or she names the individuals to receive his or her undivided interests in trust lands.
  • If the owner does not have a written will, his or her undivided interests in trust lands are distributed to his/her eligible heirs under the American Indian Probate Reform Act of 2004 (AIPRA) that became effective for individuals who pass away on or after June 20, 2006 (*except Alaska, the Five Civilized Tribes, and Osage).

AIPRA creates a new nationwide probate code for all reservations.* Prior to AIPRA, state laws determined how trust or restricted lands passed from generation to generation. The new federal probate code applies to all individually owned trust and restricted lands* unless the tribe has a Department of Interior approved probate code.

Fee Land (also known as Fee Simple Land or Fee Patent Land)

Unlike trust land, fee land generally means that an individual owns the property outright and that the land is not held in trust for a tribal member by the United States government. If there are no restrictions on it, landowners can gift or sell their fee land without BIA approval.

Fee land is subject to county, state and federal taxes; including annual property taxes. Land in fee can be used as collateral for a loan.

Ways Property is Titled

Typically, fee land and trust land are titled in one of the following ways:

  1. Sole ownership (one owner)
  2. Co-ownership (two or more owners)
    1. Tenancy in common.
    2. Joint tenancy with right of survivorship.

Sole ownership 

Sole ownership means there is only one owner. Unless a tribe exercises jurisdiction over fee land upon an owner’s passing, solely owned fee land passes under state law (if no will exists) to the owner’s heirs or to whomever the owner has named in a written will. AIPRA does not control the distribution of solely owned fee land located on a reservation. AIPRA does control any solely owned trust or restricted land.

Co-ownership 

Co-ownership of fee and trust land exists when two or more persons hold legal title to the same property. There are two types of co-ownership recognized under AIPRA:

  1. Tenancy in common.
  2. Joint tenancy with right of survivorship.

Tenancy in Common

Under this method of co-ownership, two or more people hold an undivided interest in the same property with no right of survivorship for the surviving tenant in common. No right of survivorship means that the surviving co-owner does not inherit (unless named in a will) the other’s share. Two or more people can own land as tenants in common.

Each tenant in common has the right to transfer his or her proportional share by selling it, giving it away, or by transferring it to people of his or her choice at his or her passing by a written will.

Undivided interest means each tenant in common owns a part of the total value. If two people have a tenancy in common one owner cannot claim to own the valuable parcel of land with an oil well and claim that the parcel without oil belongs to another owner.

Joint Tenancy

If fee land is held in joint tenancy with right of survivorship, the deceased co-owner’s interest is eliminated, and the last survivor becomes the sole owner.

What can you do?

To ensure the passing of your property to those whom you wish, learn how your land is held. Is your land held as:

  • Individually owned trust or restricted?
  • Fee (fee simple or fee patent)?

Request your copy of an Individual Trust Interest (ITI) Report from the BIA Realty office to determine the amount of undivided interests you own. Once your ownership status is determined, decide how you want your interests to be divided among members of the next generation.

Reference

Related Topics

Financial Planning and Security, Farm Business Management

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