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Inherited mineral rights in Texas

You inherited minerals. Do these in order.

Royalties do not move on their own when an owner dies. Each payor needs to be told, and needs proof of who owns the interest now. Here is the order, the two deadlines that matter, and the letters to send.

Start with the stubs. They name every lease.

WHEN AN OWNER DIES, THE DECIMAL IS SPLIT

OWNER'S DECIMAL

0.00097656

  • Heir A0.00032552
  • Heir B0.00032552
  • Heir C0.00032552
  • Together0.00097656

Shares can differ. The will, or the law, sets them.

The timeline

What happens when

Two clocks run in the background: four years to probate a will, and three years before unpaid royalties go to the state.
  1. First weeks

    Gather the papers

    Order several certified death certificates. Find the will, deeds, leases, division orders and the last royalty stubs. The county courthouse where the land sits holds lease and royalty documents. RRC FAQ
  2. First 3 months

    Tell every payor

    Write to each operator. Until it has proof of who owns the interest, it may hold payments without interest. NRC §91.402(b)
  3. First year

    Settle who owns it

    Probate the will, or prove heirship if there is none. Then send each payor the papers, a W-9 and a division order for each heir.
  4. 4th anniversary

    Last day to probate a will

    After it, a will cannot be admitted unless the applicant was not in default. Est. Code §256.003
  5. 3 years unpaid

    Royalties go to the state

    Unclaimed longer than three years, they go to the Comptroller. Claiming has no deadline. Prop. Code §75.101

Step by step

Seven steps, in order

Each step says what to do and where to go next.
  1. Step 1: Find out what the minerals are

    Start with the last royalty stubs and 1099s. Each names a lease. Look each one up to see the county, the operator and what it produces. Then check ClaimItTexas for money already sent to the state.

  2. Step 2: Order death certificates

    Payors, banks and the Comptroller will each want one. Order several certified copies so none of them waits on another.

  3. Step 3: Write to every payor

    Send owner relations the owner's number, the date of death and your contact details. Ask for its list of papers. The letter below does it.

  4. Step 4: Settle who owns the interest

    With a will, admit it to probate. With none, prove who the heirs are. The two routes are below.

  5. Step 5: Send the papers and a division order

    Each heir gets a decimal. Read the division order before you sign it. It can hold only the items in section 91.402(c), and it does not change the lease. What a division order may say

  6. Step 6: Ask about held money

    Ask each payor what it held from the date of death, and when it will pay. Money held for a proper reason carries no interest. NRC §91.403

  7. Step 7: Check the new statements

    Once the new decimals are in place, compare each month with the state record. Rebuild the decimal, or run a full check.

Checklist

Tick it off as you go

Fifteen items in four groups. Your ticks stay in this browser.

INHERITED MINERALS · CHECKLIST

0 of 15 done

Gather
Tell the payors
Settle who owns it
Get paid

Your ticks stay in this browser. Nothing is sent to us.

Settling title

A will, or no will

How the interest moves decides what you send each payor.

There is a will

  • Admit it to probate, with an executor and letters testamentary or, when the estate owes nothing beyond real-estate liens or needs no administration, as a muniment of title. Est. Code §257.001
  • The will names who inherits and in what shares. Those shares set each heir's decimal.
  • Mind the four-year limit. Est. Code §256.003

There is no will

  • Texas law decides who the heirs are, and in what shares. The Comptroller applies Estates Code sections 201.001 to 201.003.
  • Prove it with a court order declaring heirship, or a sworn statement of family history and heirs, recorded in the county deed records. Once recorded for five years, a court receives it as prima facie evidence. Est. Code §203.001
  • Ask each payor which proof it accepts.

Copy these

Two letters to send

Send each one to the payor's owner relations, by certified mail, and keep a copy.

Letter one, after a death

Copy and fill in

I am writing about owner number [number], [name], who died on [date]. Please send me your list of the papers you need to pay the heirs, and tell me whether any payments since that date are being held.

Letter two, with the papers

Copy and fill in

I enclose [death certificate, probate order or affidavit of heirship], a signed W-9 and a signed division order for each heir. Please confirm the decimal for each heir, the date payments will start, and when the held months will be paid.

FAQ

Questions people ask

What should I do first when I inherit mineral rights in Texas?

Gather the papers: certified death certificates, the will, and the deeds, leases, division orders and latest royalty stubs. Look up each lease named on the stubs to see who operates it. Then write to each operator's owner relations, give the owner's number and date of death, and ask what it needs to pay the heirs. Also search ClaimItTexas in case money has already gone to the state.

Do I have to probate the will before I get royalty checks?

The payor decides what proof it needs to pay you, and it may hold payments without interest until it has proof of who now owns the interest (Natural Resources Code section 91.402(b)). A will can be admitted to probate as a muniment of title when the estate owes no debts other than real-estate liens, or there is no need for administration (Estates Code section 257.001). Ask each payor what it accepts.

How long do I have to probate a will in Texas?

A will cannot be admitted to probate after the fourth anniversary of the death unless the applicant shows they were not in default in failing to present it in time. If the will is admitted after that date, letters testamentary cannot be issued unless the application was filed by the fourth anniversary (Estates Code section 256.003).

What is an affidavit of heirship, and does it work for royalties?

It is a sworn statement of the family history and the identity of the heirs. A court receives a recorded affidavit as prima facie evidence of the facts in it once it has been in the county deed records for five years (Estates Code section 203.001). Whether a payor accepts one sooner is up to the payor. The Comptroller also accepts an affidavit of heirship for an unprobated will when the claim is under $10,000 and the will's beneficiaries are the same people who would inherit with no will.

How do I find out what mineral rights my parent owned?

Start with royalty stubs and 1099s, since each names a lease or an operator. Look each lease up in the state record. The county courthouse where the land sits holds the leases and royalty documents. Search ClaimItTexas for the owner's name, because royalties unclaimed for three years are sent to the Comptroller.

Look up a lease

Why are the checks so small after the decimal is split among heirs?

Each heir's decimal is a share of the owner's, so each check is a share of the old check. Small amounts can also be held: a payor may accrue payments of $100 or less for up to 12 months, and may hold amounts under $10 until production ceases. On written request it must pay annually if the amount is under $10, and monthly if it is between $25 and $100 (Natural Resources Code section 91.402(f)).

Do I owe tax on inherited royalties?

Royalty income you receive is reported as royalty income, on Schedule E line 4. Your basis in inherited property is generally its fair market value at the date of death. The taxes guide walks through the 1099, severance tax and depletion.

Royalty income, taxes and your 1099

Start with the stubs. Look up each lease.

Once you know which leases pay, you know which operators to write to.