Question

Oil Lease Sale

Forum|Forum|5 years ago
June 25, 2020
1 reply
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Received Oil Gas Lease as a gift. Sold it within a week. I paid a 26K bill for the person who gave me the gift. Can I deduct this as a expense? Is this considered other income?

Carl11_2

Employee

I paid a 26K bill for the person who gave me the gift.

You need to elaborate more. Doesn't look or sound like a gift to me, if you paid $26K to the person you got it from. Paying a liability for that person is no different than you giving that person the money, and they pay their debt. THis would mean your cost basis on the lease is $26K. If you sold it for more than $26K then you have a taxable gain. If sold for less than $26K, you have a loss.