What is going on in SEC 24-03N 04W? Just received an offer from Warwick-Jupiter through their agent Red Sky Land to lease with three bonus options. The third option is $1250 and 3/16th (low ball of course). So what is going on there?
There activity of some sort in 6 of the surrounding 8 sections.
That may not be such a low ball off at this time. That doesnāt mean that there is not more potential however. Warwick-Jupiter is a Non-Op investment group. That is more that anything has been pooled for in the 3N-4W and 3N-4W in the past year. It has been in the $650-$1000 range with 3/16 RI .
Does anyone know of a good cpa in area that is very knowledgeable with royalty income and trust?
My dad wants to transfer ownership of his rights to me. He lives in Colorado and I live in CA and the mineral rights are in Garvin County. Any idea on how we proceed?
Jonni, friend me with the blue icon next to my name. I have an excellent one in Oklahoma City.
Thank you so much for all the details. I guess I should have known it wouldnāt be simple
Giving any property of value and not receiving something of equal value in return can cause the gift tax to be due if the fair market value exceeds certain limits (generally $14k per donee per year). This tax attempts to capture part of your property that would be caught in the estate (death) tax. If we did not have the gift tax, then you could give your estate away during your life and avoid the tax at death. The estate tax as we know it is a gift of the Democrats who controlled Congress and the Presidency in 1916 when it was enacted. The gift tax that we know today is another gift from the Democrats who controlled Congress and the Presidency in 1976 when the gift tax was harmonized with the estate tax.
Michele,
The question sounds easier that it really is.
The simple answer is a deed with the correct property description signed by him and acknowledged in front of a notary. It is then filed with the county clerk in the county where the property is located.
However, the type of deed used can depend on many factors.
A Quit Claim Deed, Warranty Deed, Mineral Deed, Royalty Deeds and even some combinations are used. The state of residency is of little importance (see tax notes below) as long as the deed and procedures conform to Oklahoma statutes.
Then your father needs to decide what he wants to give you and when. He could choose to hold executive rights basically controlling the lease and receiving the benefits and you would get production income. He could use a āTransfer on Death deedā, or a use a deed where he holds a life estate in the property. Some things may cause more problems than they fix. For instance it might be a good idea for the person retaining a life estate to get a power of attorney from the remaindermen to ease leasing of the property. A transfer on death is revocable until death. Transferring and retaining a life estate is not.
The value of the property could be an issue. He basically must receive fair market value from you in exchange or gift the rights to you. Currently you are limited to receiving $14,000 in 2017 from him without him being subject to taxes for the remaining value. If the rights are worth more, you really need to work with an estate planning attorney and/or a VERY good CPA. California and Colorado may even want to get into the game, so plan carefully.
The description of the property deed needs to be correct. You donāt want a residual amount left that is not properly conveyed. Language can be added to ensure all of the property he intends to convey is fully transferred. Sometimes shortcuts in deed preparation lead to frustration and large legal bills many years later when something is not correctly conveyed.
There could be other factors that you may need to consider. My answer just touches on the subject and is not meant to be professional advice.
There are also ways to exercise the estate tax exemption prior to death. The federal estate tax exemption is currently at $5.49M. A gift can exceed the $14k limit yearly and not be subject to federal IF properly documented. Search on Unified Estate and Gift Tax Credit. Again there is much more complexity than can be answered here.
We donāt know the several of the factors that need to be considered. Micheleās may be talking about mineral rights worth $500. Val might be talking about property worth $15M.
Additionally a husband and wife could each give $14k in property annually to a child. And to that childās spouse. There is a $56k transfer. Do it on Dec 31st and again on Jan 1st of the next year and youāve transfered $112k in 2 days. State laws could vary on what they tax.
Consult your tax professional and/or an qualified attorney before proceeding and make sure your actions are compliant before making the move.
I was under the impression if a deed of minerals were passed to your family it did not fall under the same rules as say giving money? Does someone know the answer? Val carter
Sorry but it is one of my least favorite taxes. The goal in 1916 was to reduce vast concentrations of wealth which it obviously has not done. However, it has spawned an entire estate and gift tax planning legal industry as well as given birth to the grotesque creations such as the GST (generation-skipping tax) thereby providing employment to thousands of lawyers and accountants.
Mr. Weeks, stated very diplomatically, the estate tax; the gift that keeps on givingā¦ to the government.
Thank you for all of the advice. Iām talking to my CPA to get it figured out and Iāll let you know the outcome
Need some information for a friend if someone can help. He owns minerals in Section 16 3n 4w in Garvin and has received papers saying they have spud on the first of 7 new wells to be drilled there. He doesnāt live here and I want to go check on these for him. Iām thinking that that location would be straight north of our sec. 16 2n 4w in Stephens but how far north is that? Better still if someone knows which road Iād take off of highway 76 to go west (Iām thinking when I find the road then Iād go about 2 miles west but section 9 is also included so I donāt know which one has the pad on it. So if anyone knows that and the name of the wells it would be great). Thanks!
Rickā¦on the link listing the active rigs that Gary put on the Stephens Co. forum a few days ago can you tell me if the rigs Iām talking about is the one marked with one big blue arrow. I believe it is 3 miles north of the Garvin/Stephens Co line and 2 miles west of highway 76. The friend didnāt say anything about it being padded on section 21 like those are but Iām thinking those are the ones. thanks!
Linda the wells are being drilled from section 21 under 16 & 9-4n-4w. They are going to drill 9 Woodford & 1 Springer.
Iām not where I can look at it, but itās 3 miles from the county line to the south side of section 16-3N-4W.
Ok thanks a bunch! I believe thatās it. Itāll give me a place to start looking anyway.
Itās exactly 6 miles north. A township is 6x6 miles.
Sorry for the poor grammar used in the last postā¦a little brain dead this morning! lol