Squire v. Capoeman

Summary

The Court affirmed the Court of Appeals, holding that the capital‑gain tax imposed on the sale of standing timber from the respondents' allotted Indian land held in trust was invalid because the treaty, the General Allotment Act, and the trust patent exempted such income until a fee patent was issued. The decision relied on a construction of treaty language in favor of the Indians and on congressional intent expressed in the Allotment Act. Justice Reed dissented, arguing the timber sale produced a taxable capital gain.