Selling Royalties

Question;  I know you can sell your mineral rights,and even sell just a % of your minerals, but is there such a thing as keeping your mineral rights, and just sell your royalties,or a portion of your royalties? Say you have 60 acres,with a 20% gross lease. Can you sell  20% ,or 1/3 of your royalties? Or is this done by acreage, like 20 acres of royalties, of the 60? Would this be a private agreement between the seller and buyer,or will this be a recorded document at the courthouse? Also, how would this be done by the O&G co.? And what about Taxes?    These questions will probably have to be answered by an attorney,but I was hoping a landman,or landowner who has done it, would answer to avoid attorney fees.

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Permalink Reply by catt on May 31, 2015 at 12:02pm

I should have said royalties not mineral rights.....for children.

Permalink Reply by Philip Thackray on May 31, 2015 at 12:20pm

Catt,

Such gifts are made with after tax dollars.  Gifts to a non-charity are not deductible.  If you gift more than $14,000 (the exclusion for 2015) you must pay tax on the difference.

Phil

0ym9x5ag7ury2Permalink Reply by 0ym9x5ag7ury2 on June 1, 2015 at 6:21pm

Catt,

    I was looking for the Gifting Of Children that I hear about but can't find it in the IRS code.

Do you know what form or document on IRS.gov discusses this? I've searched and had no luck, and the IRS phone was busy this past tax season.

Parents are paying to support their children since employers are blocking Unemployment when they downsize. I see this as a gift that should be allowed by the IRS.  Thanks Catt.  Ron Hale

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