If you recently inherited or received mineral rights in Texas, congratulations! Depending on the details, there are several ways you can use those rights to build your financial portfolio. For example, if you have real property, you can lease it and possibly gift part of it to other family members. You may have control over some things and none over others, but right now you may be wondering where to start.
To consider the effort required to maintain your mineral rights, start by confirming ownership. The first step is to execute a valid, notarized deed, then file it with the county clerk. This deed will contain all the specifics of your rights, whether they be royalties, minerals, or gifts.
Next, consult a qualified professional for technical analysis and economic evaluation. This process should yield a thorough valuation report. Be aware that Texas does not have licensed mineral rights appraisers, so you may need to actively gather the necessary information on your own.
Finally, speak to a tax advisor who can review your rights and help create a plan to manage tax filings. Claiming mineral rights on taxes can get a bit complicated, so an expert CPA may be worth the price to avoid getting in trouble with the IRS.
These are only a few things to consider when you expect to keep and manage your mineral rights. And if you already understand the business, maybe you’re fine with managing the hours of time, money, and paperwork. But if owning mineral rights is like falling into a new country where you don’t speak the language, maybe the idea of selling mineral rights in Texas is a better one.
Saying ‘No’ Could be the Smarter Decision
When a financial opportunity falls in a person’s lap, their first thought may be to keep it. Even if they know nothing about the industry, owning mineral rights sounds like a really lucrative investment, doesn’t it? And maybe your friends are telling you about others who ‘made a killing’ in the oil and gas business with their mineral rights. It’s very tempting. But if you know nothing about the business, there are more than enough opportunities to make very expensive mistakes.
Everyone has to decide where to put their investment energy. As mineral and royalty owners across the United States, we don’t want you to sell your mineral rights in Texas unless you believe it’s the best option. When seeking financial advice, it’s smart to listen to experts with a solid track record of success. One of those voices is the Oracle of Omaha, Warren Buffett. Buffett has a video discussing five rules for success. One of his key rules is to learn when to say ‘no’ to an opportunity. Invest in what you know and stay true to it. In the long term, Buffet says it’s a wise move.
If you are ready to sell your Texas mineral rights, contact us. We can give you a quick turnaround so you can invest where you feel more comfortable.