Re: Investment Types by via_newsgroup
via_newsgroup
Mon Sep 01 13:05:23 CDT 2003
In microsoft.public.money, Zev wrote:
>Any suggestions on how to account for an investment in a
>gas well (natural gas) production? This investment has
>the following attributes: intangible drilling costs,
>depletion allowance, monthly income and zero value of
>original investment.
Firstly, Money is not going to understand and handle the details of
this. You can keep track, but the K-1 is your only real tool for
doing your taxes.
I would create an investment account and enter the units as a Stock.
When/if you get a distribution, don't enter it as a dividend, but as
an Other Income or Return of Capital as you decide. But this does
not get entered into the schedule D. So when you close out the
investment, you might use a Remove Shares.
You are probably going to be able to deduct the entire investment,
minus the token distributions, in a year or two. :-( Filling out
schedule E can be confusing. The salesman (or con-man) probably told
you they would tell you how to do the taxes. That may or may not
turn out to be true. But it will reduce your taxes. That part is
true.