JPatrick
Thinks s/he gets paid by the post
- Joined
- Jun 3, 2005
- Messages
- 2,610
We are pretty close to inking a deal to lease our mineral rights (farm land) to an oil company for a five year term. Involves the typical upfront lease payment and future profit sharing.
I've already taken care of step one--ice down champagne---but I'm wondering about the tax implications of this lump sum payment.
It will amount to low 6 figures paid in one payment.
If anyone has been through this drill with the IRS, I'd love to hear about the experience, specifically, what type of income this is considered and whether there is any magic to soften the blow. I think I have a plan to deal with future profits (if any) but I'm concerned about the lease payment.
Any thoughts/guidance appreciated.
I've already taken care of step one--ice down champagne---but I'm wondering about the tax implications of this lump sum payment.
It will amount to low 6 figures paid in one payment.
If anyone has been through this drill with the IRS, I'd love to hear about the experience, specifically, what type of income this is considered and whether there is any magic to soften the blow. I think I have a plan to deal with future profits (if any) but I'm concerned about the lease payment.
Any thoughts/guidance appreciated.