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SECTION 1. PURPOSE
Internal Revenue Bulletin 1997-51 · 2026-10-03 edition · updated 2026-10-04 · United States
This revenue procedure sets forth the conditions under which the Internal Revenue Service will consider issuing an advance ruling that a right to mineral is a production payment as defined in § 1.636–3(a) of the Income Tax Regulations.
December 22, 1997 22 1997–51 I.R.B.
.04 The present value of the production expected to remain after the right terminates is 5 percent or more of the present value of the entire burdened property (determined at the time the right is created). The determination of present value takes into account all the facts and circumstances, in accordance with the provisions of § 1.611–2(e).
DRAFTING INFORMATION
The principal author of this revenue procedure is Brenda M. Stewart of the Office of Assistant Chief Counsel (Passthroughs and Special Industries). For further information regarding this revenue procedure contact Roger E. Baker on (202) 622-3120 (not a toll-free call).
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