Oil & Gas Property Taxes Due

by Kenneth E. DuBose on July 18, 2011

This is the time of the year that county appraisal districts begin sending out delinquent tax notices. Do not forget to set aside savings to pay property taxes, as well as the money Uncle Sam will come calling for at the end of the year. Property taxes are the easy to overlook, but keep the title to your property free and clear by keeping them paid. Various states and counties have different methods for valuing mineral rights, but you’ll likely be paying a predefined fraction of what you made for the year.

Also, set aside income tax dollars for your lease bonus and royalty. You’re likely going to be taxed at your ordinary income tax rates unless you sold property throughout the year. That means get ready to pay your marginal tax rate or the highest rate you pay. Be sure to check the current IRS tax rates or check with your CPA. Royalty and bonus dollars will often bump you into a higher tax bracket.

If you’re just lucky enough, you might need to make quarterly estimated tax payments.

“As Friday’s deadline looms for paying second-half real-estate taxes in Tuscarawas County, most property owners will pay on time. However, those with longstanding delinquent tax bills are seeing increased efforts to collect those bills.”“ ‘Overall, collections are still running strong — we’re very fortunate that most people in Tuscarawas County pay their taxes,’ county Treasurer Jeffery Mamarella said.”

“ ‘After reviewing the delinquent list, it’s apparent that some companies are struggling due to the economy. So are individuals and families, who are either unemployed or under-employed and experiencing difficult times.’ ”

“Out of 62,419 total parcels of land that taxes are paid on in Tuscarawas County, there are 2,881 delinquent.”

“Mamarella said that several of the delinquent properties involve coal.”

“Lindberg said that a person may only own mineral rights for coal on a property. He said natural gas and oil are taxed based on production.”

“ ‘The tax value is $150 per acre for the mineral rights on that coal, not the actual market value of the coal,” Lindberg said. ‘Even if you think the coal would be worth more, we’re only seeking payment of the $150 per acre.’ ”

Read the full news release at TimesReporter.com

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