Important Tax Forms All Mineral Rights Owners Should Know About

When it comes to owning mineral rights, you could stand to make a lot of money if you choose to lease or sell those rights. However, additional income also means additional taxes, and complying with the IRS’ myriad of tax forms is nothing short of onerous for most mineral owners. Whether you’re receiving oil and gas royalties or debating selling your mineral rights, here are some of the tax forms you should know about. Please keep in mind that we are not attorneys or CPAs; please consult your own accountant or legal counsel for tax advice. For IRS guidance on the subject, please click here.

Leasing Your Mineral Rights

When you lease your mineral rights, income may come in the form of delay rental, oil and gas royalties, and lease bonuses.

There are a few additional tidbits of information to know about these forms:

Selling Your Mineral Rights

If you sell your mineral rights or oil & gas royalties, the IRS indicates that the sale can be treated one of two ways:

Make sure you discuss the sale with your attorney or CPA to ensure proper reporting on your tax return.