I recently just learned of land I inherited in 2008. I received a letter in the mail from Headwater Minerals to sell oil and mineral rights and royalties in lea county, New Mexico. It’s about 8 mineral acres. My questions are to do with selling and taxes. There was no estate tax done so I’m not sure the price of the land then. Before I sell is there anything I should ask for as far as documentation and also what can I expect come tax time for this year. Thanks for your help as this is all new to me. And I actually live in North Carolina if that at all matters.
First let me state that I am NOT an attorney and do not represent my opinion to be the law...
The estate should have listed a market value to all assets and that will be your base price for the inherited parcel(s). You will need to use that valuation as the base, whatever price you receive as the current value and your capital gains tax liability.
Lastly, my experience has been, whatever price you are offered by an unsolicited offer, is usually 50 - 70 percent of the actual value.
Good luck with the transaction.
Where would in find out or contact to find out that price. I’ve asked he company offering buy and they said there was no estate trust or such done.
In my experience, every estate has probate documentation that is filed in the county where the deceased passed.
Sorry new to all of this. Even if he didn’t have a will?
Honestly, I am not certain.
I believe every state has different rules / laws and do not know the specifics of your situation. Most counties have a presence online and you may be able to find probate information pertaining to the person from whom you inherited the mineral interest.
Not an attorney, but a CPA. Some estates are small and go through probate without inventory, etc. The best thing to do is to look at tax receipts for the land back to 2008, and that could be one estimate of the value at the date of death of your loved one. You might check with the executor of your loved one's estate to ensure there was no inventory filed with the court.
If you sell the land, it will be a capital gain, and will be the sales proceeds, less the basis--either an inventory value or tax value estimate. If it is a huge number, you might look for an appraiser who might be able to attest to a value for that parcel back in 2008.
I don't know North Carolina's tax system, but many are derived from the Federal 1040, but I am sure it would be a capital gain also, but maybe not taxable in NC because it was sold in NM.
For land values then and now: Call the tax office in Lea county, NM - call the county appraiser - call a local title company and ask for referrals to realtors who sell in your area. I would guess that any/all of these people may be able to help you. Don't forget to check court records. County clerks can be helpful
The company who is making you the offer is not going to "smarten you." Be aware that not all real estate is passed on via probate. Depending on what state, sometimes it's deeded via Muniment of Title.
In some states, the probate is NOT necessarily in the county of decedent's death, it might be in the county of residence or county where decedent owned property.
This is a link to a NM map which shows oil and gas wells. It is very important to learn if your minerals are already leased and producing. A gentleman in the Lea County, New Mexico group of this forum has reported receiving an offer to LEASE his minerals for $6000/acre with a 25% royalty. Perhaps you should consider joining that group.
Muniment of title, at least in Texas, is a FORM of probate. What I call "regular probate," meaning with a will and with administration, has to be filed within four years of decedent's death. Probate as a muniment of title does NOT have the four-year requirement, theoretically it could be filed at any time as long as a "regular probate" case has not been initiated, and does NOT include administration of the Estate, just decides who gains title to the property.