Topic
7 posts
An oil & gas working interest reported on Schedule K-1 (Form 1065) rather than Schedule E is a different reporting regime: depletion is computed at the partner level, IDC passes through with separate elections, the § 761(a) election can opt the venture out of subchapter K entirely, and self-employment tax exposure differs from a directly held WI. Unlike a mineral or royalty interest — which bears no operating costs — a working interest carries capital and operating expense responsibility, which is what drives the K-1 mechanics. This post is the practitioner workflow.
Read more →IRC § 613A(c) preserves percentage depletion for the small-producer / royalty-owner class even after the 1975 repeal for integrated producers. For most individual mineral-royalty owners, the deduction is 15% of gross royalty income, reduces basis under § 1016(a)(2), and is subject to the 65%-of-taxable-income cap. This post is the practitioner workflow: when the deduction applies, when the limits bind, how it interacts with AMT, and what gets recaptured at sale.
Read more →State unclaimed-property offices hold hundreds of millions of dollars in unclaimed mineral royalties — owed to owners who moved without notifying operators, heirs who never learned they owned interests, and families who simply lost track.
Read more →WTI hits $80 on the news, but your royalty check shows $68. The gap is not always an underpayment — most of it is the differential between the benchmark and the realized price at your wellhead. Crude grades, pipeline takeaway, and gas hub basis are what actually drive your check.
Read more →If a well is producing and you should be receiving royalties but aren't, there are several common causes and well-defined remedies. This guide covers title issues, suspense, statutory penalties, and what to do.
Read more →Division orders determine how royalty payments are split among mineral owners. This guide explains how they work, what your decimal interest means, and how to resolve common issues.
Read more →Your royalty check stub contains valuable information about your production, pricing, and deductions. This guide shows you how to decode it.
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