Why is my value so high? I didn’t get that much in revenue from the operator.
The appraised value is not based on a prior year’s income. It is an opinion of the fair market value of your property and is based on the projected future income. (The fair market value represents the value that your property could sell for if you were willing to walk away from future income.)
How did you arrive at my appraised value?
There are a number of parameters used to develop your mineral property appraisal. There is a starting production rate (the operator reports the production monthly to the Texas Railroad Commission. We review that that information and determine a representative January start rate), the rate of decline (how fast is the well’s production dropping – determined from a review of the historical production trend), the previous year’s average oil and gas sales prices (whichever is applicable) adjusted down by the Texas Comptroller’s market condition factor. Other factors include lease operating expenses (developed from operator records), severance tax rates, and discount rates. See the “Taxpayer Information for Mineral Interest Owners of Oil and Gas Property” for more detailed information.
Why do I have to pay property taxes on my mineral interest?
Your mineral interest is considered real property in the State of Texas and is subject to ad valorem taxation. (“ad valorem” is Latin for ‘ according to value’).
I received a notice of appraised value (or tax statement) and it’s in the wrong name. How do I get it corrected to the right owner?
You will need to inform us and provide our office with the information in writing. If you sold your mineral interest, simply send us a request in writing (letter or e-mail) to let us know who you sold it to and their address. If you inherited it from someone, indentify who it was assessed to originally (the person’s name) and to whom it should be conveyed along with an address. If there is more than 1 heir, indicate if the interest was split evenly, or, if not, how it should be split.
My address has changed. How do I get it corrected?
You may send us a request in writing (letter or e-mail) and indicate the old address and the new address. Please see our contact information at the bottom-right corner of the page.
My notice of appraised value has a different percentage than my check stub shows. Why would they be different?
If you are being assessed at a different royalty interest than what shows on your revenue check, please contact our office so that we can research, identify, and correct the problem. If you know that you have sold or bought interest that would account for the difference, please let us know.
My mother’s (father/uncle/etc.) estate was settled and my attorney said he filed all the necessary paperwork. Why hasn’t it been changed at the appraisal district?
Information filed in the courthouse often doesn’t make its way directly into our records. We receive detailed ownership information from the lease operators in the form of a ‘division of interest listing’. If your interest has changed due to a sale or conveyance since the last time we received and updated the division order listing, we may not have most current information. Simply call our office or send us the information in writing so we can make the necessary changes and get the information to the appraisal district.
If I give you the information to change the ownership on my interest, do I need to call the appraisal district and the tax offices, too?
No, you do not need to make any other call pertaining to your mineral interest. We provide the appraised value and ownership information to the appraisal district. They send that information to their taxing entities. However, any ownership information pertaining to real estate must be provided to the appraisal district directly.
Will my value in my mineral property go down if the production goes down?
Production rate is only one of the factors in a mineral appraisal. If production rates go down but prices go up, the appraised value of your property could increase.
Am I paying all the taxes on this property?
No, the entire value of the well is proportionately divided among all the royalty, overriding owners and the working interest owner (operator) depending on their interest percentage and interest type.