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Oil Royalties

I live in Texas and have Oil royalty income from Okla. of more than $1000.00. What form do I file in Okla. and how do I enter the amount of tax Okla. withheld from my income?

3 Replies
Expert Alumni

Oil Royalties

If you received Royalties from Oklahoma over $1,000, you will be required to file a Non-Resident State Return, reporting only the royalty income and tax paid there.


Click this link for info on How to File a Non-Resident State Return.


This link gives detailed info on How to Enter Royalties  in TurboTax. 


The following information constitutes instructions from the Oklahoma Department of Revenue.  It is an exact quote:

"Filing Requirements
Oklahoma resident individual(s) are required to file an Oklahoma income tax return when they have sufficient gross income to file a Federal income tax return. Nonresidents are required to file an Oklahoma income tax return when they receive gross income of at least $ 1,000 of Oklahoma source income."

Here is a link to the relevant government webpage, if you wish to verify that for yourself:

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Level 15

Oil Royalties

I'm a fellow user, not a tax expert.   The Oklahoma non-resident return is a Form 511NR, which TurboTax can prepare.   If you want to read in detail about Oklahoma's Form 511NR and instructions, here is the PDF on the Oklahoma Tax Commission website, where you can view the actual form:


You'll see therein that in calculating your Oklahoma tax, Oklahoma first considers all of your taxable income from all sources.   By answering screens in the TurboTax state interview, you will designate/allocate how much of each category of your income is Oklahoma-sourced.   Oklahoma then prorates the taxable income by taking the AGI from Oklahoma sources and dividing it by the total AGI from all sources.

Level 15

Oil Royalties

@dkhoweatt  also asked:  "how do I enter the amount of tax Okla. withheld from my income?"


The Form 1099-MISC that you will get from the oil/gas company should show you the amount of state income and state tax withheld in Boxes 15-17.   You enter all the info from your 1099-MISC into TurboTax in the Federal interview, and the state tax withheld "should" flow to the state tax interview when you start the state return.   You may be able to doublecheck it when you go through the state interview to see that it did.   In any case, be sure to print and review the Oklahoma return prior to filing to make sure you are getting credit for any withholding.

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