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Case Study: Stroble v. Oklahoma Tax Commission

July 08, 2025

On July 1, 2025, Oklahoma’s Supreme Court issued a decision in Stroble v. Oklahoma Tax Commission (2025 OK 48, Case No. 120806). Strobel had argued that the U.S. Supreme Court’s 2020 decision in McGirt v. Oklahoma (591 U.S. 894, 240 S. Ct. 2452 (2020)), which extended the definition of Indian land to include major portions of eastern Oklahoma, also applies to Oklahoma income tax.

Case Overview

  • Parties: Alicia Stroble (Appellant), a member of the Muscogee (Creek) Nation, vs. Oklahoma Tax Commission (Appellee).
  • Issue: Whether Stroble, who resides and earns income within the boundaries of the Creek Reservation (as recognized in McGirt v. Oklahoma), qualifies for a state income tax exemption under O.A.C. § 710:50-15-2(b)(1).
  • Decision: The Oklahoma Supreme Court affirmed the Tax Commission’s denial of Stroble’s exemption claim.

Key Legal Findings

  1. Three-Part Test for Exemption: Under O.A.C. § 710:50-15-2(b)(1), to qualify for the “Exempt Tribal Income” exclusion, a taxpayer must:
    • Be a member of a federally recognized tribe,
    • Reside on Indian land belonging to that tribe,
    • Earn income from sources within that same Indian land.
  2. Court’s Holding:
    • The parties stipulated that Stroble is an enrolled member of the Muscogee (Creek) Nation.
    • The parties stipulated that Stroble’s income was earned from sources within “Indian Country” under the jurisdiction of the tribe to which the member belongs.
    • The Court affirmed that Stroble did not live within “Indian Country.”
  3. McGirt Not Extended to Taxation:
    • The Court declined to extend the U.S. Supreme Court’s ruling in McGirt v. Oklahoma (which recognized the continued existence of the Creek Reservation for criminal jurisdiction) to civil tax matters.
    • It reaffirmed that state taxation authority remains intact unless Congress has explicitly stated otherwise.

Implications for CPAs and Tax Advisors

  • Tribal membership alone is not enough: Clients must meet all three prongs of the exemption test.  Income must be earned from tribal sources or employment directly tied to the tribe.
  • Location of work matters: Even if a client lives and works within reservation boundaries, the nature of the employer and income source is critical.
  • Documentation is key: Ensure clients claiming exemptions have clear evidence of tribal membership, residence, and employment or income derived from tribal land.
  • Caution with McGirt-based claims: The decision signals that Oklahoma courts are not inclined to expand McGirt into areas like taxation without clear federal direction.
    • Consider maintaining all pending claims until all potential appeals of the Stroble decision have been exhausted (see below).

Appeal Rights in Stroble v. Oklahoma Tax Commission

Following the Oklahoma Supreme Court’s decision in Stroble v. Oklahoma Tax Commission, Alicia Stroble has limited options for further appeal:

  1. Petition for Rehearing: Stroble may file a petition for rehearing with the Oklahoma Supreme Court.  However, such petitions are rarely granted unless there is a clear error of law or fact.
  2. Appeal to the U.S. Supreme Court:
    • Stroble may petition the U.S. Supreme Court for a writ of certiorari.
    • The basis would likely involve federal questions, such as the interpretation of tribal sovereignty and the scope of the McGirt v. Oklahoma decision in civil contexts.
    • The U.S. Supreme Court is not required to hear the case and grants certiorari in a small percentage of petitions.
  3. Legislative or Regulatory Change:
    • While not a legal appeal, tribal nations or affected individuals may seek federal or state legislative clarification or regulatory amendments to address the tax treatment of tribal citizens in Indian Country.

OSCPA members are encouraged to explore the case study and share this update with your networks using this client letter template to ensure awareness of the case’s implications on CPAs and tax advisors.

This case study was created in conjunction with the OSCPA's Tax Committee.

Written by: Mark O. Neumeister, CPA, Chair of the OSCPA Tax Committee
Reviewed by: Blaine Peterson, CPA, and Jimmy J. Williams, CPA