I tried to search for an answer, so I’m sorry if this has been asked before. Live in Montana and paying taxes on the mineral lease one time payment that we received in 2020. But do I need to pay taxes on it in ND since the minerals being leased are in Burke County? I have a feeling I need to do a filing in ND huh… Any answers are greatly appreciated! My 1099-Misc from Lone Tree has MT listed on it… nothing about ND.
Beth
Hey Beth, No idea if you’ve gotten your reply as yet. A relative novice, myself, this would be my reply! If you live in Montana yet the minerals being worked are in North Dakota, you would have to file an out of state Income Tax for ND. I live in Tennessee and have been getting a statement since 2010. Sadly, ND as I’ve discovered yearly does not allow for filing electronically meaning each year I have to “mail in” the forms to the state and await a rebate, if one, by snail mail. If you live in MT yet the minerals are worked “in” MT I would think looking at the following link would assist: Individual Filing Status - Montana Department of Revenue
In essence, if you live in MT and rec’d royalties you would have to file. The leasing company should have filed and sent you a 1099-Misc. At least this is what Continental has provided me yearly!
Hi, thanks for your reply. Yea… it’s just a mineral lease, all paid up front for the 3 yr lease. No Royalities at all. My 1099-Misc only has the total amount given to me, and then in the state portion only MT on it. I called Burke County treasurer’s office today but they didn’t have an answer either. Will see if anyone else has any input? Thank you again!
If it is just a lease then I only had to file it on my taxes! Now if there is ever a well, ND will be taking out their tax plus to have to file. Last year my accountant did not file in ND. It appears it would have cost me more than the $50 I would be getting in refund.
If it is below a certain amount, ND does not need a tax return. The ND tax people are actually quite helpful.
I had some issues early on with ND taxes as I was not clear on what was required and there was no withholding at that point. It turned out to be minor stuff - $150 for one year, $30-40 for most years and nothing for some years (most of my income was from elsewhere). I did not amend my resident state taxes, but just paid the ND stuff. It got all cleaned up and no issues since. Ancient history at this point.
I won’t opine as to whether ND tax is due, but will simply note two things: 1. The tax forms are on the ND tax website and are fill-in-the-boxes pdf forms; otherwise, TurboTax has a ND add-on for a modest fee; 2. ND taxes are low, so it is just no big deal to keep on the up and up (usually, you get a credit for the ND taxes paid against your home state taxes).
If your mineral interests are in a trust or a corporation, it becomes more complicated as TurboTax for those does not have an add-on for North Dakota and you will have to use the fill-in-the-box forms.
When and if you have production income, the oil companies will withhold ND taxes above a certain modest level. It is pretty minimal, but I usually get a refund anyway.
So, this is just no big deal. After the first year, it will be just. 15 minute annoyance.
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