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Klein described meetings on the issue and has been gathering comments and recommendations on what can be taxed as income. Klein said the discussions show that additional guidance is needed, as well as clarification of rules governing when such benefits can be taxed.
• Christine Jacobs, director of the Office of Indian Tribal Governments at the IRS, said the exemption for social welfare benefits is not in the federal tax code but is an administrative exemption. She said to be excluded from taxes, benefits and payments must be made under a governmental program, promote the general welfare and not represent compensation for services.
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