Farwell v. Commissioner
United States Tax Court
1. The petitioners, owners of an oil lease, assigned all their right, title, and interest in the lease to an oil operator, reserving, however, an overriding royalty and 25 per cent of all oil, gas, and other hydrocarbons produced after the assignee made deductions for royalties, overriding royalties, drilling and development costs, and operating expenses.
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1. The petitioners, owners of an oil lease, assigned all their right, title, and interest in the lease to an oil operator, reserving, however, an overriding royalty and 25 per cent of all oil, gas, and other hydrocarbons produced after the assignee made deductions for royalties, overriding royalties, drilling and development costs, and operating expenses. Held, that the 25 per cent interest retained by the petitioners was a net profits interest, and that they are not entitled to depletion deductions based upon 25 per cent of the gross production. 2. Held, that an amount paid to a title…
1Opinion of the Court
Byron H. Farwell and Martha Allan Farwell, et al., 1 Petitioners, v. Commissioner of Internal Revenue, Respondent
Farwell v. Commissioner
Docket Nos. 71041, 71042, 71043, 71044, 71045
United States Tax Court
35 T.C. 454; 1960 U.S. Tax Ct. LEXIS 5; 13 Oil & Gas Rep. 891;
December 29, 1960, Filed
Decisions will be entered under Rule 50.
1. The petitioners, owners of an oil lease, assigned all their right, title, and interest in the lease to an oil operator, reserving, however, an overriding royalty and 25 per cent of all oil, gas, and other hydrocarbons produced after the assignee made deductions for…
2Cases cited19 opinions
- Burton-Sutton Oil Co. v. CommissionerSupreme Court of the United States · 1946
- American Properties, Inc. v. CommissionerUnited States Tax Court · 1957
- Courtney v. CommissionerUnited States Tax Court · 1957
- Bowers v. LumpkinCourt of Appeals for the Fourth Circuit · 1944
- Television Industries, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1960
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