Five Reasons to Sell Mineral Rights
Updated: Apr 12, 2019
In the past, it was common to hear the saying ‘never sell your minerals’ and it was common for owners of mineral rights to ignore any calls or offers they received for selling their mineral rights – but times have changed.
In fact, many now look to sell mineral rights for a plethora of reasons, and companies that facilitate those sales, or buy and sell mineral rights all on their own, have seen huge growth since the beginning of the 21st century.
Clear Fork Royalty is one such company, and though we work hard to get you the best price when you decide to sell your mineral rights, we also want you to be well informed and know the options available to you before you decide to sell.
Regardless of if you decide to sell, lease, or continue full-ownership of your mineral rights, oil royalties, and gas royalties, we want to keep you as informed as possible – that’s why we’ve listed the 5 most common reasons our clients decide to sell their mineral rights. These reasons include:
· Gaining cash and usable funds
· Being taxed at a lower rate
· Avoiding the risks of a fluctuating market
· Lessening the paperwork associated with owning mineral rights
· Diversifying your investments for more security and possible gains
Maybe you’ll find some of your own reasons mirrored in our list, or maybe you have unique reasons for wanting to sell your mineral rights – either way, contact us today if you would like a quick, free, no-obligation evaluation of your oil and gas royalties, or your mineral rights.
#1: You Gain Usable Funds When You Sell Mineral Rights
This is probably the most common reasons that individuals or families sell their mineral rights – large, lump sums of money that can be used immediately, instead of the slow trickle that many receive from leasing their mineral rights.
Whether you have an unexpected expense come up or are simply ready to move on from dealing with mineral rights and their complications, many owners decide to sell their rights and instead receive a large payout, as opposed to many, spread-out, small paydays.
#2: Selling Mineral Rights Can Help Your Taxes
April is tax season, and many of our sellers can save lots of money by selling their mineral rights instead of gaining their royalties – how? Because of the tax rates associated.
Sometimes, our clients are being taxed at as high as 39% for their royalties, but once they sell, their lump sum could be taxed at only 19%, saving them from higher taxes and bigger burdens.
Of course, all situations (and states) are different, but we would love to go over your specific details to see if selling your mineral rights could save you thousands in tax dollars.
But don’t worry about being pressured to sell, all of our evaluations and offers are no-obligation, meaning you don’t have to sell if you decide it isn’t the right option for you. Instead, just keep us in mind for the future if your situation ever changes – we’re here to help!
#3: Sell Away the Risks of Owning Mineral Rights
The market fluctuates daily, which can make owning mineral, gas, and oil rights a gamble every single day.
Some of our clients check prices and market values daily, costing them hours of time and effort, and eventually, they get tired of all the work, all the stress, and all the time that goes into their constant vigilance.
This is when many of our customers come to us to sell mineral rights instead of continuing their monitoring. Many of our clients simply get too nervous about the unpredictable nature of oil and gas pricing and would rather have cold, hard, cash in their bank account, along with the peace of mind it offers.
#4: Greatly Lessen Your Paperwork by Selling Mineral Rights
Anyone who has owned mineral rights in the past (or currently does) knows the mountain of paperwork that comes along with it, from taxes to leasing, to estate issues and more, selling mineral rights is one of the best ways to greatly diminish your paperwork.
And if you are like many of our customers – you don’t love sitting inside all day, pouring over papers, numbers, depreciation figures and more.
Instead, by selling your mineral rights and receiving immediate cash, you are able to do away with the papers and files, and instead enjoy the new-found freedom of the day.
#5: Diversification is King in Today’s Investment World
Having cash to invest in safer, more stable options is the recommended choice for those nearing or already in retirement.
Additionally, avoiding the high-risk, highly unpredictable nature of oil and gas pricing can be a big relief for individuals looking for passive income that is unlikely to take sharp dips throughout the year.
Finally, having all of your money tied up in one investment can be dangerous – which is why many financial advisors recommend diversifying. By selling mineral rights, many of our clients then have the cash to diversify their investments and create a more expansive safety net for themselves and their families.
Have You Considered Selling Some of All of Your Mineral Rights?
Whether the above reasons struck a chord with you or you’ve been considering selling your mineral rights for years, now might be a great time!