I live on the edge of a gas pipeline in Pennsylvania that will undergo repairs. While the pipeline isn't on my property, they will need access a very small part of my land (.03 acre) for their equipment during the ~ 2 month pipeline repair. They have provided me with a Temporary Workspace Agreement with 80% of the payment earmarked for 'damages' and 20% for 'consideration'. (They may need to cut down a few trees.) They will not need use of my land after the repair is done. I've looked here and it appears that I should report this as some sort of income, but I'd like confirmation.
FYI - When I asked the pipeline rep about taxes (they sent a "Request for Taxpayer ID Number and Certification" form in the packet), his reply was "I believe the money will be tax free." I provided him links to a few similar questions here noting it must be reported as income is some way, and asked for a formal source for his "I believe..." statement. Again, I got 'I've done this for years... when others received statements at tax time and called him, "I (the rep) called the company and told them it was tax free and they understood and made the correction." That was pretty much his exact reply, mentioning that those were for much larger payments than mine. So, is there a minimal amount that is / is not taxable? For someone who does this work all the time, I feel he should KNOW definitively how these payments are looked at from the tax perspective. The lack of definitive answers from them really irks me - I'm ready to decline my permission and/or ask for a higher payment! Thanks for any advise.
