IRS PLR: Mineral Royalties, Gains, Losses From Disposition of Mineral Interests

The IRS has issued a private letter ruling on Section 469, concluding that taxpayer’s mineral royalties and gains or losses from disposition of mineral interests are derived in the ordinary course of a trade or business, not portfolio income. The ruling allows the taxpayer to group activities related to mineral royalties and interests under Section 469.4 for the taxable year the ruling is received. For Section 1411, the mineral royalties are derived in the ordinary course of a trade or business, and gains or losses from disposition of mineral interests are attributable to property held in a trade or business. ...