Hello everyone! My grandmother inherited some mineral rights in Buttonwillow, CA. It has changed her SSI benefits. She would like to transfer them to me. I was told by the SSA that a transfer would automatically disqualify her from receiving benefits. There have not been any leases associated with them since 2014. Details of the deed are as follows:
1/4 of 1/2 of all oil, gas, and hydrocarbon substances.
The East Half of the Northeast Quarter of Section 20, Township 29 South, Range 24 East, M.D.B.M.
Portion of the North Half of the Southwest Quarter and of the South Half of the Northwest Quarter, all in section 33, Township 29 South, Range 24 East M.D.B.M
Portion of the North Half of the Southeast Quarter and South Half of the Northeast Quarter of Section 33, Township 29 South, Range 24 East, M.D.B.M
She does not own the surface rights.
As a family we have considered selling them, but realize now is not a good time.
We are looking for the least expensive way to address this issue. We at some point want them put into a trust for the kids.
Thank You
Dustin,
Contact Jean Pledger, a CA attorney in Bakersfield who knows about mineral transfers. Jean is also member of MRF. You may just need a Quit Claim Deed. If you need an evaluation, I have helped others in a similar situation.
Gary L Hutchinson
Minerals Managment
Hi Dustyn,
The following is a post I found on the Forum dated February 28 2012. The answer is from one of our "special" Forum members.. His response may give you something to think about when it comes to taxes. I hope he doesn't mind me copy and pasting his post.
Question:
"Hello guys, first time poster hoping to get a couple of answers from you experienced folks. So the story is my great grandmother sold a house in Long Beach California (Los Angeles County) a long time ago, but retained the mineral rights. That deed got transferred over to my grandmother, and she is now looking to give me full ownership. I'm wondering what the best way to go about this is? Can this be done by filing a quitclaim with L.A. County?"
"Also, will there be any tax related issues that I would have to take into consideration? The last thing I want is to get hit hard with taxes and end up having to sell the deed, lol.
I appreciate any insight I can get on this. Thank you for your time!"
Answer:
"If it is non-producing and it is a small NMA it should be under 13K. If it is producing and valued over that, I would Gift the Mineral Interest on a different year than the Royalty interest in the well. :) Or gift the RI in parts per year. The spouses can gift and receive the same way.
If in doubt, talk to a estate planner for advice. A simple mistake can cost you 50-60% in taxes of the value over $13k."
Good luck,
Pat