Reasons to Sell Royalties
The sale of royalty interest provides the opportunity to liquidate and clean up the assets of an estate to avoid foreclosure delinquencies or estate tax problems.
Some people sell in order to eliminate future legal expense to Probate their estates. For the Small Interest Owner, the cost associated with transferring ownership can exceed the perpetual value of the royalty interest.
It is very important to understand cost or percentage depletion of a well when computing taxes. Some interest owners do not want to incur extra costs or out-of-pocket expense for the tax preparation and administration.
Some people feel it is cumbersome to try to keep track of royalty interest income and the taxes associated with the interest. This seems to be especially true for owners of small interests. By selling your interests now, you will no longer be required to pay property taxes, which can simplify your taxing preparation or taxing problems.
With energy prices at an all time high, this is an excellent time to convert royalty interest into cash and liquidate. The Cardinal Rule is, “Buy Low, Sell High”, with the oil and gas commodity markets at an all time historic high, there has never been a better time to sell.
There are various companies that will buy your interest, just make sure you go with a reputable one so you are not taken advantage of when selling.
Texas Law Today 