Did you know that when you collect royalty income, that income is taxed at ordinary income tax rates?
When you sell mineral rights in Texas, the worst case scenario is paying capital gains taxes at 20% assuming you have owned the mineral rights over 1 year. Most will only pay 15% capital gains rates.
Did you inherit mineral rights? If so, you can save a fortune on your taxes due to step-up basis! You may only owe taxes on a portion of the total sales price. If you inherited mineral rights, selling mineral rights for tax reasons can make a lot of financial sense.
Before you sell mineral rights in Texas, take some time to consider the tax consequences of selling.