Rev. Proc. 67-11

Revenue Ruling 66-198, C.B. 1966-2, 488, requires payers of oil and gas royalties to show on information returns, Form 1099, U.S. Information Return for Calendar Year, the gross amounts due the royalty interest owners rather than the net amounts paid to such owners after withholding for various taxes levied by states.

Because certain payers have experienced unreasonable hardship in perfecting the necessary procedures for showing the gross royalty amounts, information returns reporting royalty payments for calendar year 1966 will be accepted on either a gross or a net basis.

Information reporting of royalty payments for calendar year 1967 will be required generally on a gross basis. However, for calendar year 1967, those payers who, prior to February 29, 1968, establish to the satisfaction of their district directors that such reporting would impose an unreasonable hardship in converting their accounting systems rapidly enough to provide gross payment information, will be permitted to report royalty payments on a net basis if these payments are clearly identified on the Form 1099 as representing net payments.

¹ Also released as Technical Information Release 886, dated Feb. 23, 1967.