Can you tell me if you inherit some mineral rights through a trust and 2 yrs later your siblings choose to sell their part for $12,000.00 an acre and you don’t, they have a valuation on their minerals done afterwards for capital gains tax purposes for the IRS done. Do I have to get my valuation done now if I’m not selling them. I guess I’m asking can I wait to get the valuation done if or when I sell? I know their are prospects of new wells going in and If I don’t sell my kids will inherit them someday. Don’t you get the evaluation when you sell to show the value? I’m betting it’s not as valuable then 2 yrs ago when my dad owned it as it is now or will be. Thanks for all the help.
Your value is the date of inheritance.
Is that only my value at the time of inheritance if I sell it? If I do not sell and pass it down to my kids as an inheritance then the value would be when they inherited it if they choose to sell right.
I am not giving legal or accounting advice, but based upon my experience in handling several probates, you do not have to have an evaluation unless you sell. If you pass your minerals to your children in your will, then your estate can pay for the evaluation based on the date of death or six moths later-whichever is more favorable for estate purposes. It is much easier to do an evaluation quickly after a passing than wait years and years. Your kids need to hang onto that appraisal in case they ever sell.
Thank you all for your help.
good afternoon- I have a suggestion. Could we do a poll or question asking for regional quotes or actual signed documents as pertaining to rights of way and or leasing.values? I hate seeing landowners being taking advantage of by signing for way less than marketable values let alone signing documentation that is not up to date or in favor of the landowner/royalty owner.
1 Like
It would be a lovely idea, but that information is very hard to come by. Unlike surface real estate, mineral leases and sales information is very confidential and not easily obtained. Very determined by location, location, location and reservoir and competition in that area. Prices vary by what the lessee or buyer offers.
The forum is a good place to get some clues, but you have to post in the state and county where you are interested. Local folks can usually help some. OK has forced pooling so that gives public information for those cases for leases. Many states have state auctions, so that info is public.
You can only use the alternate 6 month valuation date if it both reduces the value of the gross estate and reduces the amount of estate taxes that will be paid. It cannot be used if value 6 months after the date of death is higher than the date of death value and no estate taxes will be paid to obtain a higher basis for income tax purposes.
1 Like
In Oklahoma if minerals are sold, a documentary tax stamp is required and they are public. You can determine the sales price within $500 based upon that information. For leases no tax stamp is required.
This post is not legal, tax or investment advice. Reading or responding to this post does not create an attorney/client relationship.
Can you tell me more about this valuation of an estate or death date? Or perhaps where ai can find out more information about this? As I understand it, capital gain taxes are based off of the value of your rights at the time it was inherited. But how does one know that if no such valuation exists? Is this a federal law? Are there ways around it? Is there a means of accessing it another way than from the deceased’s Personal Representative if they won’t produce or acknowledge a request for such a record?
Thank you in advance for your consistently informative, prompt, and benevolent responses and advice!!
This topic was automatically closed after 90 days. New replies are no longer allowed.