In a Planned Unit - What should I do now?
So our property has finally been put into a proposed unit. The hearing for the Withey NE and NW units are scheduled with the Ohio DNR in December. Based on other units in the area, if the schedule is similar, royalty checks should start to come in within the next 12-18 months. What should I being doing to prepare? Are there steps that I can take to reduce our tax burden? Also, I have heard many people on this site state that you should never sell your mineral interest. However, I have received what I consider a good offer of $17,000 per acre on a 17% no deduction lease. If we were to sell we would only sell 25%-50%. Should I get an oil/gas appraisal for the property and what should I expect to get from that as a result? A lot of questions, and there are probably some important ones that I haven't even considered. Any input/advice would be appreciated. Thanks.
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Permalink Reply by tacoma7583
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I received a very similar offer in Columbiana county per acre to buy my rights. the current unit is only about 70% of my property, so if they come back and drill the NE laterals ill be really happy with my decisions. The unit im has had higher oil production than the others in the area so this helps even with lower oil prices using the forecast for 12 months production even when I pay taxes, single no real deductions. I'll break even on what I would have earned if I would have sold the rights. I asked three different accountants about anything to help save taxes and they didn't have any solutions that seemed legit. One presented a plan but it felt like a good way to get audited in the future. The only other tax situation was like a 1031 exchange on the mineral rights if sold , but I didn't want to buy a property just to buy.
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