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jiwarr
New Member

Does the sale of mineral rights I have owned through inheritance since 1987 qualify as Long Term Capital Gains (i.e. 15% tax)? How is the basis calculated?

 
4 Replies
Critter
Level 15

Does the sale of mineral rights I have owned through inheritance since 1987 qualify as Long Term Capital Gains (i.e. 15% tax)? How is the basis calculated?

The basis of property inherited from a decedent is generally one of the following: The fair market value (FMV) of the property on the date of the decedent's death. The FMV of the property on the alternate valuation date if the executor of the estate chooses to use the alternate valuation.

And all inherited property is considered long term even if you sell it the day you get it. 


SweetieJean
Level 15

Does the sale of mineral rights I have owned through inheritance since 1987 qualify as Long Term Capital Gains (i.e. 15% tax)? How is the basis calculated?

Aug 12, 2017?
Critter
Level 15

Does the sale of mineral rights I have owned through inheritance since 1987 qualify as Long Term Capital Gains (i.e. 15% tax)? How is the basis calculated?

just the date the info was posted ... came with the cut & paste.
FARTIMER52
New Member

Does the sale of mineral rights I have owned through inheritance since 1987 qualify as Long Term Capital Gains (i.e. 15% tax)? How is the basis calculated?

I inherited the royalty interests on several oil and gas properties from my father, who died in 1996. I started receiving monthly payments from these properties in 2013, and have been getting these ever since. Recently, I got an offer from a company to buy my interests in these properties.   Every site I've looked on says that the income threshold for any tax liability on long term capital gains is $39,375; there is zero liability for incomes below that.  My income this year will be less than $24000; two-thirds is SSRI (I'm retired), one-third is the royalty payments. The offer I received for these mineral rights is $32000.  Question: If I decide to take this offer to buy my interests, will I have to pay a LTCG tax on this amount, or an amount adjusted by subtracting the FMV of the properties at my father's death?  Thanks

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