I am hopeful that someone with a little more experience with mineral rights sales can confirm the amount of capital gains tax that I will be required to pay after I sold my mineral rights (I live in Texas by the way). My situation is as follows (numbers are adjusted for simplicity's sake):
- I purchased $50,000 worth of mineral rights in January 2006 (mineral rights only, no surface)
- I began receiving royalties from my minerals in 2009 ($10,000 cumulative as of January 2010)
- I sold 100% of my mineral rights for $100,000 in January 2010
My assumption is that I will have to pay Uncle Sam the 15% long-term capital gain rate on the profit from sale. In other words, I will owe 15% * ($100,000 - $50,000) = $7,500.
Is my assumption correct?