Frequently asked questions
TAX INFORMATION
Below is information about forms and taxes.
FORMS
W-9 Tax Form
The IRS and federal law require that individuals, partnerships, and other legal entities provide a valid Taxpayer Identification number (TIN). You will need to provide this to ExTex.
For individuals, a Social Security Number (SSN) is required.
For corporations, trusts, and limited liability companies (LLCs), a Federal Employer Identification Number (FEIN) is required.
Click here to get a copy of a W-9 form from the IRS website.
1099 Form – When It Is Mailed
We will mail you a 1099 on or before January 31. The 1099 is a tax form that is used to report income to the IRS. We send you and the IRS a copy of the form.
1099 Form – Have Not Received It
Please allow 2 weeks for delivery of your 1099 after January 31. If you have not received your 1099 by mid-February, please call (303) 463-8799.
Colorado DR21-W Form
The Colorado DR21-W form is provided to interest owners who own an interest in a well located in Colorado, for which severance taxes were withheld and remitted to the state. Royalty owners will receive a DR21-W on a lease-by-lease basis. Click here for more information about the DR21-W form.
Have Not Received DR21-W Form
We will mail you a DR21-W form on or before March 1. Please allow 2 weeks for delivery of the form after March 1. If you have not received your DR21-W form by mid-March, please call (303) 463-8799.
W8 BEN
A W8 BEN form needs to be filled out by any foreign individual who receives U.S. income. The form must contain a foreign tax ID or a U.S. tax ID. A mandatory 30% federal withholding tax will be taken out of all income and reported to the IRS. At the end of the year, foreign individuals will receive a 1042 form (not a 1099 form). Click here for more information about the W8 BEN form.
TAXES
Reporting Revenue For Federal And State Income Tax Purposes
Royalty interest owners who receive $10 or more annually and working interest owners who receive $600 or more annually must report it to the IRS and state. If you have received more than these amounts, you will receive a 1099-MISC form, which will be mailed out on or before January 31.
Federal Backup Withholding
ExTex requires a valid Social Security Number (SSN) or Tax ID Number (TIN), which is submitted to us on the W-9 form. If you choose not to provide this number, the IRS requires that we withhold 28% of revenue for all U.S. citizens.
Severance Tax
In oil and gas, severance tax is a state-imposed tax on the extraction (i.e. “severance”) of nonrenewable natural resources, such as crude oil and natural gas. Most states in the U.S. impose a state severance tax when oil and gas is produced. The tax is computed based on the value or volume of oil or gas sold at the oil head.
Conservation Tax
Some states impose a conservation tax on the production of oil and gas, which is used to fund the regulation and oversight of the industry.
Ad Valorem Tax / Property Tax
Ad valorem tax (also known as property tax) is based on the appraised value of the oil and gas within the well and the equipment related to the well. The tax is assessed by the county where the well is located, and it is generally calculated by using production information from the previous well and a fair market value of the well equipment.
If you have any questions, please call (303) 463-8799 or fill out our contact form.