I am confused.
A few weeks ago, respondents on this forum advised that Division Orders were not public documents and were internal to the Oil Company.
Now we have just heard the suggestion that our SS #s can be compromised by the paperwork involved in the process. Further that we might want to get an Employer Identification Number and then even avoid whatever Division Order Document the Oil Company might send us to sign and get our own off the internet.
What’s up, oh many out there wiser than I?
http://www.nadoa.org/forms/div_ord.pdf
Fill in the blanks using the form that the oil company sent you as a guide. All the company that is buying your product needs is your name, address, phone number and that you have the correct division order interest amount. Look at the interest on the form they have, match it with yours and copy to the NADOA form if it is correct. There should be no other terms except the clause that says something like “This Division Order does not change any terms of the lease.” (I received several recently that tried to add post production costs back in.)
http://www.irs.gov/uac/Form-W-9,-Request-for-Taxpayer-Identificatio…
W-9 is the form you send in.
My comment was meant to say, do not put your EIN or SS on the DO, but rather instead put it on the W-9 and send it in with the paperwork. Each document requires its own info and no reason to put EIN or SS on a document that doesn’t need it and won’t have the same level of security as the W-9.
If you file for an EIN, be prepared for the IRS to require an income tax return to go with it, so know why you want it. Usually for a business, trust, partnership, LLC, etc. Know what you are doing and why.
Virginia, some people don’t want to use their SS# because they fear identity theft. The EIN# won’t stop theft, but it can slow a thief down and it’s another number to use when tracing a thief. Also, some people do their own stock market investing, and hire a CPA to help with complicated reporting of MLP’s, etc., so the CPA is needed anyway.
Here I is! LOL Div Orders are online for anyone and everyone to see, all you need is the link, and nearly all of them have been posted here from time to time, as are Spuds, Drilling Permits, Completion reports, and if you know how to read all of the data on those reports, you are smarter than me, and probably have more time than I to devote to reading and deciphering them. If I had 20 or more acres, I might be a little more concerned with what they say, but with 2 acres, who cares? I have better things to do.
Harley,
I think the reason someone said to get the division order offline is because NARO has a very good division order. Phillips 66 also has a very good division order. I have signed lots of division orders from oil companies and haven’t had a problem. You just need to read and know what you are signing.
I have never seen a division order ask for SS #, you usually fill out a tax form (can’t think of the # right now) that is sent along with the division order. The only other paper that may come with it is a direct pay to your bank account, etc. and it will ask for SS #. If someone gets a division order that asks for SS#, I wouldn’t fill it out.
Also, when you get an EIN, you will have to file a separate tax form for that unless you put everything under it. It works best for business and not for the general public as far as I know.
Victor,
NARO has one that their members can use. I think someone did list it on here.
Thanks for the tax form #. I could see it, but couldn’t remember the #.
Also, I do not know where a division order would be public information. Maybe someone can tell us.
Virginia, My CPA told me the online EIN # application can be for a sole proprietor as a person acting in their sole capacity and you do not have to form an LLC, LP, S corp., C corp, DBA or any other type of business entity. I went online to check if she was right and sure enough there is a selection for sole proprietor where you can select other for what type of sole proprietor you are and put in oil and gas mineral owner interest and get the EIN # instantly.
Virginia, you’re right about the CPAs getting pricey, but I had a good one save me in an audit one year. I told the IRS agent this CPA was on speed dial and when I picked up the phone the auditor’s face went white and he said he was mistaken about the misreporting.
Martha,
You are right that a person can have an EIN#, but most people don’t need one. First, most people have a little interest, dividend, few thousand in oil/gas and a paycheck. So, why do you want to have the CPA fill out 2 tax returns? Now if you have a trust, LLC, etc., that is different.
M Barnes,
The division order form you show is a lazy company’s way of doing business and I wouldn’t put my SS or EIN# on it. I would get a W-9 and send it with it.
You, and others, are right Virginia, I was thinking Pooling order. It is my belief and opinion that either the SS number or EIN must be reported on return of the Division order, or payment will be less, 30% to the Feds, and I hear Oklahoma takes a lot, too. I hope they can fix some potholes with it.
Ronald Von Wilson,
You are right, if you do not enclose a SS# or EIN, the oil company has to keep taxes out. I believe it’s 28% in Oklahoma if they don’t have your numbers. One year, I sent a W-9 along with the division order and they misplaced the W-9 and kept 28% out, did not realize it till my CPA told me I didn’t owe as much on taxes or estimate. If you have a # on file, I think it’s about 5.? %. I can’t keep up on that.
Wow! Thanks for all the good information.
Anyone for “Words with Friends”?
Martha,
I am not disagreeing with you on the EIN#, it’s good in some cases. But, I personally don’t want to pay my CPA to fill out any more papers than is needed. His bill is already high enough. Most CPAs charge per form and lots of people don’t even use a CPA. On trusts and lots of other cases, it’s wise to use an EIN#. Each case is different.
Is there some kind of a trend in the output reports of Slawson wells and others in the Logan County area? Slawson seem to be all under 100 bpd, while all others are 600 and up to over a thousand bpd. I am not a big believer in stastics, but… and BTW Winsoton gave a speech in a small school in MISSOURI in which he coined the words IRON CURTAIN, but more importantly he also said in that speech that … “there are 3 kinds of lies today, there are lies, damned lies and the third kind of lies are called stastics.” I totally agree with him, the more we get to know, it seems the less we really do know.
“Winston” in the post below should be Winston Churchill, PM of Great Britain during WW2. Sorry, I need to read what I am about to post more.
Logan: Slawson Exploration Co. Inc.; Mallard No. 1-16H Well; SW1/4 SE1/4 SE1/4 SW1/4 (SL) of 09-17N-03W; 98 barrels oil per day, 130,000 cu-ft gas per day; TD 8,845.
Iron Curtain Speech at Westminster College, Fulton, MO for those trivia buffs out there.
Iron Curtain, forgive me for typing error.
Virginia, I adore XP myself. I think that if Microsoft or any other company stops supporting something, anything, then they should forfeit their copyright and its protection forever and it should go straight to the public domain. I have already been pushing for this. It may just happen.