Answer 'No' if your Form 1099-MISC reports only your share of the royalty income and you are not transferring any part of that income to someone else.
You can also use depletion as an expense for this royalty income.
Percentage Depletion Allowance
For oil and gas royalty owners, percentage depletion is calculated using a rate of 15% of the gross income based on your average daily production of crude oil or natural gas, up to your depletable oil or natural gas quantity.
This will be entered on your Schedule E - Sign into TurboTax
- Click on search at top right and enter schedule e > Press enter > Click on Jump to schedule e
- Click Yes - click appropriate box then Continue - Edit or Add your property
- Confirm information and Continue until you complete this section
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