landowner

Income Taxes: Do I declare the signing bonus as regular income or a capital gain?

I've been reading the IRS stuff about the gas well money. I have received no royalty money but I did get a rather decent signing bonus. This is all confusing. I received a 1099 in the mail from the gas company. My question is : Does that mean that the signing money is declared as strait income or is it a capital gain as everyone is telling me?

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landownerPermalink Reply by Keith Mauck (Site Publisher) on February 3, 2009 at 6:39

Oil & Gas ProPermalink Reply by The Old Goat on February 3, 2009 at 6:44
According to my information from the IRS, bonus money is considered straight income. Depending on the size of your bonus, you will have to pay up to a third as income tax. The best advice is go to the IRS office and pick up the necessary forms. They will tell you what you will need.

landownerPermalink Reply by Don Crisman on February 3, 2009 at 8:04
Thanks for the replys. Kathy's site was great. Thanks for the help. I didn't find that site when I searched.

landownerPermalink Reply by intrepid on February 3, 2009 at 9:55
Take the opportunity to contact your congressman now and tell him that lease bonus payments are an economic stimulus and should only be taxed at a flat rate of 10% and it should be retroactive back to 2008 or whenever.

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