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San Juan Basin Royalty Trust Message Board

  • jbedrava jbedrava Mar 13, 1998 10:58 AM Flag

    what happened

    I can't find a reason why SJT dropped at open today. It's not quite 11 am est and I've been looking, but can't find a thing ... I can guess that dividend is going to be down because of mild winter, but don't know for sure. Anybody have a clue?

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    • and vli

    • Tyy

      Royality Trusts to look at.

    • Look at your SJT tax info letter, and they tell you your very own personal alt. fuel credit. They call it the "FNS Credit."
      The credit is claimed on Form 1040, Page 2. If your units are in street name, perhaps you did not receive their tax info letter.
      For my tax preparation purposes, taking possession of all royalty UBI certificates is preferable to street name, because it
      cleans up, in a timely manner, so many tax related uncertainties. -------"Trust corpus" as reported in the annual report is
      PROBABLY nonsense. I have owned many royalty trusts and in their annual reports I have seen the "value discounted at 10%" fluctuate
      up and down with discovery of resources and the price of gas & oil, but I can't remember seeing trust corpus do anything but go
      down or stay the same. -------I'm no tout, so I'll let you dig out and research various royalty trusts. ---- I can say that SJT
      has BY FAR discovered additional resources to a greater degree than any other trust I've been in. Some, by rule in their
      prospectus(i), don't even try. At the same time, SJT has invested more money looking for additional gas than any other trust of which I am
      aware; and that is one reason that our monthly payouts vary and in some months are skipped altogether.------ Hope this sheds some
      light on a complicated subject.

    • you're quite correct in that. The nonrenewable fuel credit is a thing of beauty all right. I believe it is line 45 of the
      1040 form with 'NFS' written in for a tax credit. This is a straight deduction from the taxes you owe. The whole thing, Sched E
      and all is really not that difficult and shouldn't require an accountant. Anyone astute enough to have found SJT should be able
      to do the tax forms - no problemo. I was curious when I did mine that the NFS credit for WTU seemed much greater as a
      percentage of total income than the one for SJT. Any thoughts on that? In my earlier messages I just lumped in all
      credits,depreciation, taxes, etc., but the NFS is far and away the best of them.

    • Bottomfisher - Please enlighten me/us on the Alternative Fuel
      Tax Credit. Plus, can you elaborate more on the relevance
      of the book value -- is it in fact nonsense? You seem to be
      very knowledgeable about this type of investment/business,
      are there are royalty trusts you are involved or invested with? UP

    • Some SJT comments--It has consistently found new hydrocarbons, esp. gas. The first payment to unit-holders was before 1984.
      So much had been paid by 1990 that the "trust corpus" (book value) fell below $2.-, and today it is ca. $1.20. As you know,
      they pay 50 cents to a dollar (sometimes more) each year, so they are frequently finding more resources. We must, however, pay
      $8.- per unit to purchase SJT; thus the premium to book is 400%, and so the public feels the $1.20 book value is nonsense.
      Schedule E is not complicated to complete (compared to Schedule D) but accountants would still likely sock it to you for Schedule E
      preparation. What you all have failed to discuss (relative to IRA disadvantages) is the wonderful annual Alternative Fuel Tax Credit that
      SJT affords its unit-holders.

    • just how long is the life expectancy of SJT's holdings? Never having seen a record of when production began, or when it peaked (if it has), you've teased me with your message, SSHowze. Please, enlighten me.

    • royalty trusts do become worthless as the reserve is depleted. the trusts reserves are reestimated periodically, but that does change much. the production forms a bell shaped curve over the years so if you know the year production started and the year production peaks which is midlife for the field, then you can closely estimate the final years of production. period 1 equals period 2.

    • Omniken - You don't sound like a novice to me. Sounds more
      like you've got it figured out. But different approaches work for
      different needs, neither necessarily being right or wrong.
      Whatever works for your particular circumstances (see Help 70
      message below). Agree with both you and Help 70 re.
      accountants, arrgh. I wish it were only as simple as "software".
      Thanks for your comments. UP

    • holds 3000 shs and loves it. 12% is all I need and this one will give me 12% over the foreseeable future with very little risk at below 8. Also have some in individual account and software takes care of all the tax forms. Who needs a tax accountant these days, you can buy the best software for less than 1/2 price after March 15.

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