Discussion:Reporting of oil and gas royalties by a corporation
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Discussion Forum Index --> Basic Tax Questions --> Reporting of oil and gas royalties by a corporation
Discussion Forum Index --> Tax Questions --> Reporting of oil and gas royalties by a corporation
| 3 July 2008 | |
| I have a C-corp client who made an investment in oil and gas wells through an energy company in 2007. The corp received a 1099-MISC reporting gross oil and gas revenues along with an supplement reflecting each well and the taxes and operating expenses. This corporation is not in the oil and gas business. It was simply an investment. I reported the gross royalties on Line 7 (Gross Royalties) of the 1120 and added the taxes paid to Line 17 (Taxes and Licenses) and operating expenses to Line 26 (Other Deductions).
My question is did I do this correctly? I was recently given this 1099 and instructed to file and amended return if required. Originally the net distributions were included as part of interest income which is not correct. Also, would this corporation be entitled to a depletion expense deduction? I have no prior experience with oil and gas investments and would appreciate anyone's help. Thank you. Ed | |
| 3 July 2008 | |
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