Mineral rights gifted

Hi! My mother (living and in her 80’s) told me that when she sold her house in Texas that she did not sell the mineral rights. She would like to gift the rights to me, however, she no longer has any records from the sale of the home and moved out of state. She did receive a royalty payment from a gas lease in the past, but it expired years ago. I’d like to know where to get started when all I have is an address of the house. Any information is of value.

The county register of deeds would be a good place to begin. It’s not uncommon to sell the surface property and keep the minerals.

If you let me know the county, and I can direct you on where to search for the records. Or I can maybe find it and post the legal for you. All she would need to do is a simple quit claim deed to you, and then file it in the county. There are tons of free forms online you could use.

Thank you, it is in Tarrant county. If there is an online form that would sure make it easier.

Depending upon her estate size, it might be better to put the minerals in a will or instrument that passes upon death. If you ever sell, you will need the value of minerals as of a certain date. If she passes it to you with a deed, it will be at her value. If she passes it upon death, the value of the property as of her date of death. Depending upon the area, that could make a big difference in capital gains taxes along the way. Might be good to contact an attorney about the issue.

You can search Tarrant County deed records online here: https://tcrecordsonline.com/

Thanks, Matt. I was able to locate the deed records. M. Barnes, There is not much of an estate, but I would be interested in knowing how you would determine the value of the mineral rights, and when it becomes taxable.

An accountant can give an exact definition. In general, the basis value of the minerals are are set as of the date of purchase or inheritance and the sale value then. So your mom’s basis would be her value when she inherited or bought them. If she deeds them to you now, that is the value. And going back in time to get comparable sales is very difficult. If she wills them to you, then the basis is reset as of the value at the date of her death. It can be based upon comparable sales in the area or a licensed petroleum engineer can do the evaluation. Depending upon the area and any activity over the years, current values may be higher due to new drilling in the area, so the capital gains tax would be based on the difference between the sales and the basis. You want that amount to be smaller.