Did anyone get a 1099 for mineral rights they sold in 2014?  If so, what kind of 1099 was it?

Views: 1974

Reply to This

Replies to This Discussion

None here so far.  Have a call into Bounty.

You won't receive a 1099 from them. Selling mineral rights is a sale of real property. Just like when you sell your home the purchaser will not issue a 1099. It's up to you to report the money earned.

Under IRS laws, there are circumstances where a 1099 must be issued for property sales - though in many cases the lawyer handling the closing will assume it is unneeded due to the capital gains exclusion.

For a large amount, such as a mineral rights sale, I would push for a 1099 if I were you so that you have a paper trail for your records and an audit, if you are unlucky enough to get one. If the rights sale was for a large acreage that gave you a one time only income over $200,000/ year I would have all my paperwork in line for an audit, and if it was over $1 million in that year, I would expect an audit.

Getting a 1099 also makes sure that the right information went to the IRS; which box which amount goes in can effect your tax rate and whether certain expenses get deducted.

Thanks for the reply, Jonathan H.   Can you please elaborate what you mean by capital gains exclusion? 

 

 

When you sell a house, if you have lived in it for 2 years out of the last 5, you don't have to pay taxes on the first $250,000 of gain ($500,000 for couples) - last year I sold a house I had lived in, then rented, and I was sent a 1099 even though I could claim this exclusion.

I assume the exclusion only applies to surface property and not mineral rights, but I am not a lawyer or an accountant. I could be wrong.

Thanks again, Jonathan. You have been very helpful.

RSS

© 2024   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service