Do you take 15% Depletion Allowance on Your Tax Return for INHERITED Oil & Gas Royalties

Did you INHERIT your Oil & Gas Royalties? Do you take the 15% Depletion Allowance on your Tax Return? Some say it's a grey area in the Tax Code and many do take it.

I inherited my Royalties and was told by a Tax Preparer that since I inherited them and did not PURCHASE the Property or Oil & Gas rights for INVESTMENT PURPOSES that I could not legally claim 15% yearly depletion on my income taxes. He showed me the IRS Code. 

Those of you who have inherited your Oil & Gas Rights and have a CPA's or Tax Preparer doing your taxes what have you been advised? Are you taking the 15% depletion deduction?

Views: 334

▶ Reply to This

Replies to This Discussion

Permalink Reply by Nancy Mosley on January 21, 2025 at 5:20pm

I always have. Your ancestor considered the oil and gas rights as an investment, even if just by retaining them when selling the surface. That is how I view it. Of course I am not a lawyer or accountant.

Permalink Reply by Dott on January 23, 2025 at 11:41am

good point nancy. thank you

RSS

© 2025   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service