On December 16, 2025, the IRS issued a final rule allowing tribal-owned companies, including section 17 corporations, section 3 corporations, and wholly owned Tribal entities, to qualify as “tax-exempt” entities delivering public benefits or services as an “instrumentality of one or more Indian Tribal governments.” This change allows such entities rather than the Tribal government to monetize tax credits under section 13801 of the IRA.
IRA section 13801 allows tax-exempt entities, state and local governments, Native American tribes, and Alaska native corporations to elect to treat certain tax credits as refundable payments of tax. The IRS final rule allows these entities to directly receive tax credits under Section 6417 of IRA section 13801.