Tax Bills Should Equate To Money Received?

General Mineral Rights Discussion
1

I own mineral rights in Texas and I have been trying for some time now to figure out what I own. Please tell me if I am on the right track.

Mineral rights are not taxable unless you are receiving money from leasing them or production of gas and oil. If this is true, it would follow that if I get tax bills, I should have received some kind of income. I have a bunch of bills for taxes on plats that have never paid anything.

The counties in Texas would only know to tax me if there was income reported to them by the oil company that leased the land. Is this correct? Can the counties tell me who reported the income to them? That would then tell me what companies to contact to get my money. Would this work?

To me it would be logical to include the name of the company reporting income on the tax statement. These statements are like getting W2's, they should at least tell you who is paying you!

2

Dear Ms Laird,

I attached a copy of a recent county tax appraisal. The bill comes from The County Tax Collector. You will note that there is a lease number on the tax bill. That number is assigned by the Texas Railroad Commission. Also, there is a well name and operator (in this case, Samson Lone Star LLC) and a well name and it also shows a royalty interest.

Now, the county tax bill has nothing to do with your income. The County Appraisal District taxes are based on the assigned value of your asset as of December 31 of the taxable year.

You might not be receiving income because a division order was never signed. There can be a myriad of reasons, that is jut one example.

If it were me, I would gather my county tax statements, and contact by mail the listed operator and find out the status of your account.

3

Dear Mr. Cotten,

I am looking at one of the statements I know about. It's from Montague County and I am receiving money on this one. I don't understand where it tells me who has the lease, what company I would contact. Here's what's on it as owner information.

ID:N000002387

GEOID:M0006.0334.1011.9075

Owner INTEREST 0.63476 RI

I know this lease is owned by Glen Gonzenbach and the only place I can see his name is under legal information and it says: LEGAL: Laird Estate "A", Gonzenbach, Glen, A-139 F Cook.

The appraised and assessed value is 33,270. Does this mean I should have received this amount of money as income in 2012?

If I didn't know this one belonged to Mr. Gonzenbach, how would the information I gave you let me find him?

Thank you for your reply!

Patty

4

Patty, The appraised value is more than the income you,received. It is based on last year’s production and oil and gas prices.

So are you getting tax statements on wells you are not receiving checks on? Those are the ones you should try to track down the operators on.

There is an instructional video on the Home page of this website that shows how to pull info off the RRC website.

5

Thanks Wade! I am going there right away! I have bunches of these statements I have been trying to use to see what I own. That site should be a big help.

Patty

6

Dear Ms. Laird,

The key is in the listing of the operator, Glen Gonzenback, stated on your tax statement. All operators must be approved and are included in a directory published by the Railroad Commission.

The link to the directory is here:

http://www.rrc.state.tx.us/data/operators/ogdirectory/index.php

Going to the "G" section and you will find:

310223 GLEN D. GONZENBACH, LLC P O BOX 513 HENRIETTA TX 76365 (940) 538-6129 (940) 538-6129

So, it is a two step process in this case. Remember, what Gonzenbach sends you is a 1099 Misc for the Feds. The 1099 is on income received that you pay tax on.

The county sends a tax bill on real property asset value.

The county tax bill is based on the asset value as of 12/31 of that taxable year. The notice of your estimated tax is here:

http://www.isouthwestdata.com/client/webProperty.aspx?dbkey=montaguecad&stype=id&sdata=N000002387&id=N000002387&time=20135260139054

The other taxes are taken out of your check. Those taxes are called severance taxes and are paid to the State of Texas.

Texas has no state income tax.

Confusing, but I think that you are on the right track now.

7



Pete Wrench said:

I can envision two scenarios off the top of my head in which you could get a tax statement from your local CAD without having ever received a royalty check:

(1) the well was drilled, the production was reported to the CAD, but January 1 comes and goes without the Division Order being finalized and sent to you.

(2) the well was drilled, the production was reported to the CAD, you signed and returned your Division Order, but January 1 comes and goes without your getting a check because your payments are in suspense due to a cloud on title of some kind.

I just found one of these, contacted the company and they sent me a check! This is a challenge but there's money at the end of the tunnel.

8

Yikes! That last one I don't want to think about...