My mother had inherited mineral rights from her mother 30 years ago here in Oklahoma. Never really produced much over $150.- $200. per year. In turn, in April 2021 at her death, my brother and I was willed 4 of those mineral rights properties. Her grandson was willed the other 4. My brother and I immediately began the process of selling our mineral rights. My question…We have no idea of valuation until the company offered all the owners of the mineral rights in our family a certain amount. Could that offer be used as cost basis valuation for mineral rights?
Visit with a CPA on this. You should find that you are entitled to a stepped-up basis with the valuation date being your mother’s death. There may be some IRS rule presuming that the actual sales price is the basis if the sale occurs within a certain time frame. Otherwise, you may want to have the minerals valued. If producing there may be a rule based upon the last year’s income.
This is definitely not legal or tax advice, just things to ask you tax professional. Use a CPA!
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