Replies to This Discussion

Permalink Reply by Wayne Miller on September 19, 2011 at 4:59pm

 I think typically it is 60 days after signing that payment is made anyway, so you may only talking about another month longer.

Permalink Reply by scott brion on September 19, 2011 at 5:35pm

I would make sure that you are dealing with a Talisman employee and not a contract landman.   In general, Talisman is a reputable company and it would not be unusual for a company to wish to push leasing expense to the next quarter as leasing budgets are often quarterly or annual.  For what its worth, in my experience if an offer was not legit, they would just sign you and slow play the payment later rather than tell you up front.

Permalink Reply by milton nelson weir on September 19, 2011 at 6:10pm

Thanks Scott.  I think that I have spoken to a landman as well as an outside consulting firm in addition to a Talisman VP.  Thanks for your thoughts.

Permalink Reply by grayhairedgrandpa on September 19, 2011 at 5:37pm

Just a thought...if you are in negotiation mode. Approach Talisman to pay 1/2 bonus money late December 2011 and 1/2 bonus in January (or later) 2012. This would give you a more favorable situation for income tax purposes.

Permalink Reply by milton nelson weir on September 19, 2011 at 6:08pm

Great idea for spreading the tax into to years.  My aim is to create a trust which will own the mineral rights for my kids.  Working now with a estate tax expert so we'll see.  Thanks for your input.

 

 

 

Permalink Reply by Frank Walker on September 20, 2011 at 4:17am

Not saying it is important or relevant.  But you might want to be certain your tax expert is aware of Revenue Ruling 68-606.

 

I am not a 68-606 acolyte.  However, at the same time, I am not one who would argue the merits of ignoring it entirely.

 

Speaking in general, the area of structured payments (of all kinds) has been something of a focus for the IRS in recent years and goodness knows I'm no expert on this rather arcane subject matter.  The trouble seen from time to time is that even the so-called tax "experts" have remained unaware of (what are fairly recent) developments.  The other problem, which is seen quite often with the "experts", is that when they do become aware of something like this they play safe.    

Permalink Reply by milton nelson weir on September 20, 2011 at 7:23am

Thanks Frank, it's on my list of thing to discuss.

Permalink Reply by Eleanor D on October 6, 2011 at 11:42am

Great discussion all around, Milton.  My question is, will heirs take ownership of the mineral rights, even if the property is sold outside the family?  I am working on a reverse mortgage, and wonder what happens to any mineral rights, when the mortgage company takes possession of my land.

Permalink Reply by milton nelson weir on October 6, 2011 at 12:14pm

Eleanor, we don't own the property.  The rights were reserved for my great grandfather's heirs when he sold the property in the '30's.  His deed specifically set aside the rights for our ultimate inheritance.

MIlton

 

Permalink Reply by Finnbear on October 6, 2011 at 1:45pm

Eleanor,

If you currently own the rights, then you dictate what happens to them. You can reserve them away and keep them before entering into the reverse mortgage. Then when the mortgage company takes possession of the surface ownership, you still hold the mineral interest.

Bottom line - see an attorney

Permalink Reply by Finnbear on September 25, 2011 at 12:49am

Better make sure this is legal and get all your ducks in a row before doing it. There is IRS policy and documentation on the subject.

Permalink Reply by milton nelson weir on September 25, 2011 at 7:46am

that's why I have hired a tax attorney. thanks for your input.

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