Reference

Oil and Gas Severance Tax by State

Oil and gas severance tax by state is set by each state's statute or revenue agency, and royalty owners usually see their share deducted from the check. This reference gives the rates in 25 producing states, whether each state taxes royalty income, and the federal royalty rate history, every row with its source.

Release 2026.10.1, reviewed October 6, 2026
CSV and JSON
Not tax advice

Severance or production taxes fall on oil and gas as it is produced. AMR read 25 producing states: 22 levy a severance or production tax, and California, Pennsylvania and Virginia levy no state severance tax but charge another levy or leave it to local government. In most of them the royalty owner’s share is deducted from the check. Royalty income is taxed separately: 9 of 51 jurisdictions levy no broad personal income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. The other 42 tax royalty income as part of their income tax. Every one of those states also taxes a nonresident on royalties from property in the state, except that Indiana’s rule is unclear in the sources read; the District of Columbia taxes residents only. California, Montana, New Mexico, North Dakota, Oklahoma, Pennsylvania and South Carolina require the payer to withhold state income tax from some royalty payments. Selling an interest raises different questions, such as capital gains and whether a 1031 exchange can defer them. This page records what the law says; it does not calculate anyone’s tax.

Severance and production taxes

25 producing states, each read from the state’s statute or revenue agency. Rates change, credits and reduced rates apply to particular wells, and the taxable base differs by state; the summary is a short form of the full record below it, and the cited source controls. States not listed here were outside this review, which does not mean they levy nothing.

Oil and Gas Severance Tax by State: map of the 25 producing states AMR read, 22 with a severance or production tax on oil or gas — **25 producing states, read from each state’s statute or revenue agency.** 22 levy a severance or production tax on oil or gas; California, Pennsylvania, Virginia levy no state severance tax but charge another levy or leave it to local government. Each state’s rates are in the cards below.

Severance and production taxes in brief, 25 states, checked October 6, 2026
	In brief	Evidence
Alabama	Privilege tax 8 percent of gross value, 6 percent for wells permitted since July 1, 1988 and 4 percent for low volume wells, plus a 2 percent production tax.	Official text cited
Alaska	Oil 35 percent of production tax value with a minimum tax on North Slope leases; gas 13 percent of gross value; landowner royalty taxed at 5 percent (oil) and 1.667 percent (gas).	Official text cited
Arkansas	Oil 4 or 5 percent of market value by average daily output, plus two small per barrel taxes; gas 5 percent, with 1.25 to 1.5 percent for marginal, new discovery and high cost gas.	Official text cited
California	No statewide severance tax; a CalGEM assessment of about $1.28 per barrel of oil or per 10 Mcf of gas for fiscal year 2025/26.	Core rule cited
Colorado	Graduated 2 to 5 percent of gross income, with a stripper well exemption and a credit for local property tax, plus a commission charge and two production fees.	Core rule cited
Illinois	No general severance tax found; a 3 to 6 percent tax applies only to wells under the Hydraulic Fracturing Regulatory Act.	Core rule cited
Indiana	The greater of 1 percent of value or $0.24 per barrel of oil and $0.03 per Mcf of gas.	Core rule cited
Kansas	8 percent of gross value, less a 3.67 percent credit where property tax is paid on the oil or gas, with exemptions for low producing wells.	Official text cited
Kentucky	Oil 4.5 percent of market value; natural gas 4.5 percent of gross value.	Core rule cited
Louisiana	Oil 12.5 percent of value from wells completed before July 2025 and 6.5 percent from newer wells; gas $0.1514 per Mcf for July 2026 to June 2027.	Core rule cited
Michigan	Oil 6.6 percent and gas 5 percent of gross cash market value, 4 percent for stripper and marginal oil, plus a fee of 1 percent for 2026.	Official text cited
Mississippi	Oil and gas 6 percent of value; 1.3 percent for new horizontal wells for up to 30 months; 3 percent for qualifying enhanced recovery oil.	Core rule cited
Montana	Royalty interests 15.10 percent of value; working interests 0.80 percent in a well’s first 12 months, then mostly 9.30 to 15.10 percent.	Official text cited
Nebraska	3 percent of value, 2 percent for stripper oil, plus a conservation charge of up to 1.5 percent.	Core rule cited
New Mexico	Oil: severance 3.75, school 3.15 and conservation 0.19 to 0.24 percent; gas: 3.75, 4 and 0.19 percent; plus a county ad valorem production tax.	Official text cited
North Dakota	Oil 5 percent gross production tax plus 5 percent extraction tax; gas $0.0655 per Mcf for July 2026 to June 2027.	Official text cited
Ohio	Oil 10 cents per barrel; gas 2.5 cents per Mcf; plus a small regulatory assessment on non domestic wells.	Official text cited
Oklahoma	Gross production tax 7 percent, 5 percent for a well’s first 36 months, plus a 0.095 percent excise tax and two small fees.	Official text cited
Pennsylvania	No severance tax; producers pay an annual impact fee per unconventional gas well.	Core rule cited
South Dakota	4.5 percent of taxable value plus a 0.24 percent conservation tax.	Official text cited
Texas	Oil 4.6 percent of market value; gas 7.5 percent; condensate at the oil rate; small cleanup fees.	Official text cited
Utah	3 percent of value up to $13 a barrel or $1.50 per Mcf and 5 percent above that, plus a 0.2 percent conservation fee.	Core rule cited
Virginia	No state severance tax found; counties and cities may tax gas at up to 1 percent under each of three local options.	Core rule cited
West Virginia	5 percent of gross value; 0 percent for low volume wells in 2026 and 2027; the smallest wells exempt.	Official text cited
Wyoming	6 percent of the value of oil and gas; 4 percent for stripper and tertiary oil.	Official text cited

Alabama

Privilege tax 8 percent of gross value, 6 percent for wells permitted since July 1, 1988 and 4 percent for low volume wells, plus a 2 percent production tax.

Levy: Oil and gas privilege tax (Code of Alabama 40-20-2, with 40-20-21 for deep offshore production); oil and gas production tax for the expenses of the State Oil and Gas Board (Code of Alabama 9-17-25, with 9-17-35 for deep offshore production)
Oil: Privilege tax: 8% of gross value at the point of production (general rate); 6% for wells permitted on or after July 1, 1988 (ALDOR table); 4% for wells producing 25 barrels of oil or less per day and for incremental production from qualified enhanced recovery projects; 3.65% of gross proceeds for offshore production from depths greater than 8,000 feet. Production tax: an additional 2% of gross value (1.66% of gross proceeds for offshore production from depths greater than 8,000 feet).
Gas: Privilege tax: 8% of gross value at the point of production (general rate); 6% for wells permitted on or after July 1, 1988 (ALDOR table); 4% for wells producing 200,000 cubic feet (200 MCF) of gas or less per day and for incremental production from qualified enhanced recovery projects; 3.65% of gross proceeds for offshore production from depths greater than 8,000 feet. Production tax: an additional 2% of gross value (1.66% of gross proceeds for offshore production from depths greater than 8,000 feet).
Taxable base: Gross value of the oil or gas at the point of production, levied on the entire production in the state including the royalty interest. Offshore production from depths greater than 8,000 feet below mean sea level is taxed on gross proceeds instead.
Reduced rates and exemptions: 4% privilege rate for wells producing 25 barrels of oil or 200,000 cubic feet of gas or less per day. 4% privilege rate for incremental production from qualified enhanced recovery projects approved by the State Oil and Gas Board. Wells first permitted from July 1, 1996 to before July 1, 2002, except replacements for wells first permitted before July 1, 1996: privilege rate cut by 50% and production tax set at 1% for five years from commercial production. Gas lawfully injected into pools or reservoirs, or into the earth to lift oil or gas, is exempt unless sold for that purpose or injected into underground storage. Gas lawfully vented or flared in connection with production, treatment or processing is exempt. Offshore production from depths greater than 8,000 feet: privilege tax 3.65% and production tax 1.66%, both on gross proceeds.
Royalty owners: Royalty owners bear their share: the privilege tax is levied on the entire production including the royalty interest, in proportion to ownership, and the person in charge of production operations must deduct each owner's share before paying them, while a purchaser accounts for the tax when the operator sells the oil or gas.
Local property tax: Code of Alabama 40-20-12 exempts oil or gas produced, leases in production, mineral rights in producing properties, and oil or gas under the ground on producing properties from all state, county and municipal ad valorem taxes.
As of: Code of Alabama text read October 1, 2026; sections 40-20-2, 40-20-21, 9-17-25 and 9-17-35 were last amended by Act 2009-147.
Source: Alabama Legislature, Code of Alabama 1975 (ALISON), Code of Alabama 40-20-2, 40-20-3, 40-20-12 and 40-20-21; accessed October 1, 2026. Official text cited
Scope note: The ALDOR Oil and Gas Privilege Tax page lists 3.85% for offshore production from depths greater than 8,000 feet, while Code of Alabama 40-20-21 and the ALDOR rate table say 3.65%. The statute rate is used here and the ALDOR page appears to be in error. Section 40-20-2(a)(5) says the general rate is reduced by 2 percent for wells first permitted on or after July 1, 1988; ALDOR reads this as a 6% rate. How this reduction combines with the 4% stripper rate was not confirmed.

Alaska

Oil 35 percent of production tax value with a minimum tax on North Slope leases; gas 13 percent of gross value; landowner royalty taxed at 5 percent (oil) and 1.667 percent (gas).

Levy: Oil and gas production tax (AS 43.55.011), including a separate tax on landowner royalty interests (AS 43.55.011(i)); oil conservation surcharges under AS 43.55.201 and 43.55.300
Oil: 35% of the annual production tax value of taxable oil produced on and after January 1, 2022, with a minimum tax for leases including land north of 68 degrees North latitude of 4% of gross value at the point of production when the average Alaska North Slope West Coast price exceeds $25 a barrel, stepping down to 0% at $15 or less. Cook Inlet oil is capped at $1 a barrel. Landowner royalty oil is taxed at 5% of gross value. Conservation surcharges add 4 cents per barrel, plus 1 cent per barrel when the Hazardous Release Fund holds less than $50 million.
Gas: 13% of the gross value at the point of production for gas produced on and after January 1, 2022 (a negative gross value counts as zero). Cook Inlet gas, and gas produced outside Cook Inlet and used in the state, are capped by reference to rates of the 12 months ending March 31, 2006. Landowner royalty gas is taxed at 1.667% of gross value.
Taxable base: Oil: annual production tax value, that is the gross value at the point of production less qualified lease expenditures. Gas: gross value at the point of production. Oil and gas whose ownership is exempt from taxation is excluded, and landowner royalty interests are taxed separately.
Reduced rates and exemptions: Cook Inlet sedimentary basin: oil tax capped at $1 a barrel; gas tax capped by reference to the rate for the 12 months ending March 31, 2006. Commercial production begun after December 31, 2012 and before January 1, 2027 outside Cook Inlet and south of 68 degrees North latitude: tax capped at 4% of gross value for seven years. Gas produced outside Cook Inlet and used in the state: tax per Mcf capped at the Cook Inlet amount. Credits listed by the Department of Revenue include the small producer credit and the per taxable barrel credit (AS 43.55.024). Oil and gas whose ownership or right is exempt from taxation is excluded from the production tax.
Royalty owners: Landowner royalty interests (a lessor's royalty under a lease, or a surface owner's royalty) are taxed at 5% for oil and 1.667% for gas of gross value, levied on the producer; for other taxable royalty oil and gas the producer may deduct the tax paid when settling with the royalty owner.
Local property tax: Yes, on oil and gas property. AS 43.56.010 levies an annual state tax of 20 mills on the full and true value of taxable property, defined as real and tangible personal property used primarily in exploration for, production of, or pipeline transportation of gas or unrefined oil, including wells. A municipality may tax the same property at its usual rate, and municipal tax paid by June 30 is credited against the state tax, up to the state amount.
As of: Alaska Statutes 2025 as shown on akleg.gov on October 1, 2026; the 35% oil rate applies since January 1, 2014 and the 13% gas rate since January 1, 2022.
Source: Alaska State Legislature, AS 43.55.011(e)(3), (f)(2), (i), (j), (k), (o), (p); accessed October 1, 2026. Official text cited
Scope note: The statutes on akleg.gov are the 2025 edition; amendments from the 2026 session to AS 43.55 or 43.56 were not checked. The conservation surcharge sections AS 43.55.201 and 43.55.300 were not read directly; the amounts come from the Department of Revenue page. No source read states whether AS 43.56 taxes the value of oil and gas leases or minerals in place; the definition read lists physical property such as wells, lines and equipment.

Arkansas

Oil 4 or 5 percent of market value by average daily output, plus two small per barrel taxes; gas 5 percent, with 1.25 to 1.5 percent for marginal, new discovery and high cost gas.

Levy: Oil severance tax with two additional per barrel taxes on oil (Ark. Code 26-58-111(6), 26-58-301(a)(1) and 26-58-302(a)(1)); natural gas severance tax (Ark. Code 26-58-111(5), administered under Rule 2008-4)
Oil: 4% of market value at the time of severance when production averages 10 barrels or less per well per day, 5% when it averages more than 10 barrels; plus $0.005 (5 mills) per barrel and $0.02 per barrel.
Gas: Percent of market value by Oil and Gas Commission well classification: 1.5% on new discovery gas for the first 24 consecutive months; 1.5% on high cost gas for the first 36 consecutive months, extendable until payout for at most 12 more months; 1.25% on marginal gas; 5% on all other gas and on high cost gas after the cost recovery period.
Taxable base: Oil: market value at the time of severance. Gas: market value, meaning the producer's actual cash receipts from the sale to the first purchaser less the producer's actual costs of dehydrating, treating, compressing and delivering the gas to the first purchaser.
Reduced rates and exemptions: Oil from wells averaging 10 barrels a day or less is taxed at 4% instead of 5%. New discovery gas (conventional gas wells) is taxed at 1.5% for the first 24 consecutive months of production. High cost gas (shale wells, completions deeper than 12,500 feet, tight gas, geopressured brine, coal seam gas) is taxed at 1.5% for 36 months, extendable until payout for at most 12 more months. Marginal gas is taxed at 1.25%: conventional wells unable to produce more than 250 Mcf a day, and high cost wells unable to produce more than 100 Mcf a day. Oil producers that dispose of salt water through an approved underground system get a severance tax credit, capped at $370,000 a year for all producers together.
Royalty owners: For natural gas, the royalty owner's share of severance tax is calculated the same way as the producer's and the operator deducts it from royalty payments; for oil, the Department says the tax is collected from either the producer or the purchaser, and no source read addresses the royalty share.
Local property tax: Yes. The Assessment Coordination Division states that producing mineral interests are assessed for ad valorem purposes at market value and reappraised annually, while nonproducing mineral rights are given zero value. Working interests are billed to the operator or producer and royalty and overriding interests to each individual owner.
As of: Gas rates effective on and after January 1, 2009 under Rule 2008-4, which the Department's natural gas page lists with a posting date of September 18, 2024; oil rates from the Department's oil tax page read October 1, 2026; 2026 mineral appraisal guidelines.
Source: Arkansas Department of Finance and Administration, Rule 2008-4, NG-1, NG-3.G, NG-5, NG-6.A, NG-7.B and C, NG-9, NG-10.G and H; accessed October 1, 2026. Official text cited
Scope note: Ark. Code 26-58-111, 26-58-301 and 26-58-302 were not read directly; the official code is published through a commercial host that was not tried. Rates come from Department of Finance and Administration pages and Rule 2008-4. Whether the Oil and Gas Commission imposes any separate per unit assessment or fee on oil or gas production was not checked. No source read states whether oil royalty owners bear a share of the oil severance tax.

California

No statewide severance tax; a CalGEM assessment of about $1.28 per barrel of oil or per 10 Mcf of gas for fiscal year 2025/26.

Levy: No statewide severance tax on oil and gas production; annual oil and gas production assessment (charge) under Public Resources Code Division 3, Chapter 1, Article 7 (ss. 3400 to 3434), set each year by the Department of Conservation, Geologic Energy Management Division (CalGEM)
Oil: Uniform charge per barrel set each June for the following fiscal year. Published rate for fiscal year 2025/26: $1.279550900 per equivalent barrel (one barrel of oil or 10 Mcf of gas). Fiscal year 2024/25 was $1.2156082. The fiscal year 2026/27 rate set in June 2026 was not read.
Gas: The same uniform charge per 10,000 cubic feet (10 Mcf) of gas: $1.279550900 for fiscal year 2025/26, counting 10 Mcf as one equivalent barrel. The fiscal year 2026/27 rate was not read.
Taxable base: Barrels of oil and each 10,000 cubic feet of gas produced in the preceding calendar year, excluding gas used for recycling or otherwise in oil producing operations. The rate is based on CalGEM's estimated budget for the coming fiscal year and the assessable production of the prior calendar year; for 2025/26 the page shows an assessment amount of $142,391,556.40 divided by production of 104,695,509 equivalent barrels.
Reduced rates and exemptions: No charge is levied where the assessment on a person's oil and gas production is less than $10. Gas used for recycling or otherwise in oil producing operations is excluded from the gas charge.
Royalty owners: The charge is imposed on the operator and on owners of royalty or other interests in proportion to their fractional interests; the operator pays the whole charge and withholds each owner's share from amounts otherwise payable to royalty and other interest owners (PRC 3402 and 3403).
Local property tax: Yes. CalGEM states that ad valorem (property) taxes apply, administered by each county, and Board of Equalization Property Tax Rule 468 treats the right to remove petroleum and natural gas as a taxable real property interest valued from proved reserves. PRC 3404 says the assessment is in addition to any other charges, taxes or assessments.
As of: Fiscal year 2025/26 rate as shown on the CalGEM Assessment Process page in an archive snapshot of January 24, 2026; statutes as displayed on leginfo.legislature.ca.gov on October 1, 2026; Rule 468 as amended and effective June 6, 2001.
Source: California Department of Conservation, Geologic Energy Management Division (CalGEM), Assessment Process page: Oil and Gas Assessment Rate per Fiscal Year and the explanatory paragraphs (read via Internet Archive snapshot January 24, 2026); accessed October 1, 2026. Core rule cited
Scope note: The fiscal year 2026/27 rate, set in June 2026 (CalGEM Notice to Operators on the 2025 Notice of Assessment, June 2026), could not be read: conservation.ca.gov was not available when AMR checked and the archive holds no copy. The 2025/26 rate shown is the latest one read. No source read gives county property tax rates or says whether counties assess royalty interests separately from working interests.

Colorado

Graduated 2 to 5 percent of gross income, with a stripper well exemption and a credit for local property tax, plus a commission charge and two production fees.

Levy: Severance tax on oil and gas (C.R.S. 39-29-105); Energy and Carbon Management Commission charge on the market value at the well of oil and natural gas, called the levy in the statute (C.R.S. 34-60-122); production fee for wildlife and land remediation (C.R.S. 33-61-103) and production fee for clean transit (C.R.S. 43-4-1204), both on oil and gas produced on and after July 1, 2025
Oil: Severance tax graduated on the taxpayer's gross income from oil and gas: 2% under $25,000; 3% from $25,000 to under $100,000; 4% from $100,000 to under $300,000; 5% at $300,000 and over (s. 39-29-105(1)(b)). Plus the commission charge of not more than 1.7 mills per dollar of market value at the well as fixed by commission order, and the two production fees, whose per barrel amounts are set each quarter (current amounts not read).
Gas: Same graduated severance tax on gross income from oil and gas: 2%, 3%, 4% and 5% by bracket (s. 39-29-105(1)(b)). Plus the commission charge of not more than 1.7 mills per dollar of market value at the well, and the two production fees, whose per mcf amounts are set each quarter (current amounts not read).
Taxable base: Gross income: the net amount realized from the sale of the oil or gas, whether sold at the wellhead or after transportation, manufacturing and processing, less direct costs actually paid or accrued for transportation, manufacturing and processing, including depreciation (s. 39-29-102(3)(a)).
Reduced rates and exemptions: Stripper wells are exempt: oil from wells producing 15 barrels per day or less and gas from wells producing 90,000 cubic feet per day or less, averaged over producing days in the taxable year (s. 39-29-105(1)(b)). Ad valorem credit for taxable years 2024 and 2025: 75% of local property taxes on oil and gas leaseholds, leasehold interests, royalties and royalty interests, excluding taxes on equipment and facilities; it was 87.5% for 2000 through 2023 (s. 39-29-105(2)(b)). For taxable year 2026 the percentage credit is replaced by a per well credit of 0.65625 times the well's gross income times the total local mill levies at the well's location (s. 39-29-105(2)(c)). For taxable years from 2027 the per well credit factor is 0.7656 (s. 39-29-105(2)(d)). No ad valorem credit is allowed on production that is exempt from severance tax (s. 39-29-105(2)(b)(III)).
Royalty owners: Producers or first purchasers must withhold 1% of gross income from royalty, working and other interest owners and remit it, and the owner claims that amount against the tax on the annual severance tax return (s. 39-29-111; DOR withholding page).
Local property tax: Yes. County assessors value oil and gas leaseholds and lands as real property at 87.5% of the prior year's wellhead selling price, excluding government royalty oil and gas, or 75% for secondary, tertiary or recycling projects (s. 39-7-102). The severance tax is levied in addition to any other tax, with the credit for part of those local property taxes described above.
As of: Rates and credits per C.R.S. 39-29-105 as printed in Colorado Revised Statutes 2024, last amended by HB 23-1272 effective May 11, 2023; production fees apply to oil and gas produced on and after July 1, 2025.
Source: Colorado General Assembly, Office of Legislative Legal Services, C.R.S. 39-29-105; 39-29-102(3)(a); 39-29-111; 39-7-102 (read via Internet Archive snapshot October 13, 2025); accessed October 1, 2026. Core rule cited
Scope note: The statutes were read in the Colorado Revised Statutes 2024 edition from Internet Archive copies, because leg.colorado.gov files and tax.colorado.gov was not available when AMR checked; amendments made in the 2025 and 2026 sessions, if any, were not checked. The commission charge currently fixed by Energy and Carbon Management Commission order was not read. The quarterly amounts of the production fee for wildlife and land remediation and the production fee for clean transit were not read.

Illinois

No general severance tax found; a 3 to 6 percent tax applies only to wells under the Hydraulic Fracturing Regulatory Act.

Levy: Tax under the Illinois Hydraulic Fracturing Tax Act (35 ILCS 450/2-15), which applies only to oil and gas from wells permitted, or required to be permitted, under the Hydraulic Fracturing Regulatory Act. No other state production tax was identified in the sources read.
Oil: 3% of value for 24 months from the month of first production; thereafter by average daily production of the well in the month: less than 25 barrels 3%, 25 to less than 50 barrels 4%, 50 to less than 100 barrels 5%, 100 barrels or more 6%.
Gas: 3% of value for 24 months from the month of first production; thereafter 6% of value.
Taxable base: Value: the sale price of the oil or gas when removed from the production unit, or a value the Department of Revenue sets from cash prices for like quality oil or gas when there is no cash sale or the sale price is not indicative of market price. Liability accrues when the oil or gas is removed from the production unit.
Reduced rates and exemptions: Oil from a well whose average daily production is 15 barrels or less for the preceding 12 months is exempt. Gas injected to lift oil, recycle or repressure, gas used for fuel on the production unit, gas vented or flared, and gas lost through leaks, blowouts or accidents are exempt. The tax reaches only wells permitted, or required to be permitted, under the Hydraulic Fracturing Regulatory Act.
Royalty owners: The tax is on producers, defined to include royalty and overriding royalty owners, in proportion to their beneficial interests, and the first purchaser deducts and withholds it from payments to producers and remits it.
As of: Applies to oil and gas removed on or after July 1, 2013; section 2-15 source note reads P.A. 98-22, eff. 6-17-13; 98-756, eff. 7-16-14 (Internet Archive copy April 3, 2025).
Source: Illinois General Assembly (Illinois Compiled Statutes), 35 ILCS 450/2-15 (read via Internet Archive snapshot April 3, 2025); accessed October 1, 2026. Core rule cited
Scope note: ilga.gov was not available when AMR checked; 35 ILCS 450 sections were read from Internet Archive copies dated December 11, 2024 to April 3, 2025, older than July 1, 2025, so later amendments were not checked. No official source read says whether conventional oil and gas production outside the hydraulic fracturing act bears any Illinois state production tax. The Illinois Oil and Gas Act fee read (225 ILCS 725/19.7) is an annual well fee of $100 per well for the first 100 wells and $75 for each well over 100, not a production tax. Whether producing oil and gas interests are assessed for local property tax in Illinois was not read.

Indiana

The greater of 1 percent of value or $0.24 per barrel of oil and $0.03 per Mcf of gas.

Levy: Petroleum severance tax (IC 6-8-1)
Oil: Indiana DOR lists 1% of the value of petroleum and $0.24 per barrel of oil; the statute (2014 archive copy of IC 6-8-1-8) imposes the greater of 1% of value or $0.24 per barrel.
Gas: Indiana DOR lists 1% of the value of petroleum and $0.03 per 1,000 cubic feet of natural gas; the statute (2014 archive copy of IC 6-8-1-8) imposes the greater of 1% of value or $0.03 per MCF.
Taxable base: Value: the price paid or offered for petroleum of like grade or gravity in the field or pool where the well is located, or as determined under Department of Revenue rules; the tax is imposed at severance on all producers and owners.
Reduced rates and exemptions: Gas from a well that is used to pump or treat the well is not taxed. Gas piped to a landowner's private buildings for the landowner's own use is not taxed.
Royalty owners: The tax is imposed on all producers and owners, owners include royalty, overriding royalty and working interest owners, and a person who reports and pays the tax deducts it from amounts due the owners (IC 6-8-1-7, 6-8-1-8, 6-8-1-11, 2014 archive copy).
Local property tax: IC 6-8-1-18 (2014 archive copy) says the petroleum severance tax is in addition to all other taxes, excises and fees, so it is not in lieu of property tax; how Indiana assesses oil and gas interests for property tax was not read.
As of: DOR miscellaneous tax rates page read October 1, 2026 (it shows 2026 to 2027 rates for other taxes); the rate section IC 6-8-1-8 carries the note As amended by P.L.109-1988 in the 2014 archive copy.
Source: Indiana Department of Revenue, Miscellaneous Tax Rates, Petroleum Severance Tax entry; accessed October 1, 2026. Core rule cited
Scope note: iga.in.gov was not available when AMR checked; IC 6-8-1 was read only from an Internet Archive copy dated April 6, 2014, which is stale. The current DOR page lists the percentage and the per unit amounts without saying they are alternatives; the greater of rule comes from the 2014 statute copy and was not confirmed in current text. How Indiana assesses producing oil and gas interests for local property tax was not read.

Kansas

8 percent of gross value, less a 3.67 percent credit where property tax is paid on the oil or gas, with exemptions for low producing wells.

Levy: Mineral severance tax, an excise tax on the severance and production of coal, oil or gas (K.S.A. 79-4217)
Oil: 8% of gross value (K.S.A. 79-4217(a)), less a credit of 3.67% of gross value for taxpayers liable for ad valorem property tax on the oil property (K.S.A. 79-4219(a)).
Gas: 8% of gross value (K.S.A. 79-4217(a)), less a credit of 3.67% of gross value for fiscal years from July 1, 1996 onward for taxpayers liable for ad valorem property tax on the gas property (K.S.A. 79-4219(b)).
Taxable base: Gross value: the sale price of the oil or gas at the time of removal from the lease or production unit; when there is no cash sale at removal or the price is not a true market price, the director sets value from cash prices paid for like oil or gas nearby (K.S.A. 79-4216(d)).
Reduced rates and exemptions: Oil from leases averaging 5 barrels or less per producing well per day; for wells 2,000 feet or deeper, 6 barrels or less, rising step by step to 10 barrels as the oil price falls to $13 or less (K.S.A. 79-4217(b)(2)(A), (B)). Gas from a well whose average daily production has a gross value of not more than $87 per day (K.S.A. 79-4217(b)(1)(D)). Oil from a lease or production unit whose production results from a tertiary recovery process (K.S.A. 79-4217(b)(2)(C)). Oil from a well in a pool first producing on or after July 1, 2012 that averages no more than 50 barrels per day in its first 6 months is exempt for 24 months (K.S.A. 79-4217(b)(5)). Incremental production from production enhancement projects begun on or after July 1, 1998 is exempt for 7 years, except in the 12 months after a year when the average Kansas wellhead price exceeded $20 per barrel for oil or $2.50 per mcf for gas (K.S.A. 79-4217(b)(7)). Gas injected for lifting oil, recycling or repressuring, used as lease fuel, lawfully vented or flared, or used for domestic or agricultural purposes on the lease is exempt (K.S.A. 79-4217(b)(1)).
Royalty owners: The tax is borne ratably by all producers, a term that includes royalty owners, and the first purchaser collects it by deducting it from payments to the operator or producers unless the operator elects to remit (K.S.A. 79-4216(i), 79-4217(a), 79-4220(a)).
Local property tax: Yes, in addition. The severance tax is in addition to all property taxes imposed by the state or its subdivisions (K.S.A. 79-4218); oil and gas leases and producing wells, with their equipment, are personal property assessed and taxed as such (K.S.A. 79-329), and taxpayers liable for that property tax receive the 3.67% credit against the severance tax (K.S.A. 79-4219).
As of: K.S.A. 79-4217 as last amended by L. 2013, ch. 87 and K.S.A. 79-4219 as last amended by L. 1994, ch. 304, read on ksrevisor.gov October 1, 2026; no 2026 amendment to these sections appears in the Revisor's 2026 composite list dated August 13, 2026.
Source: Kansas Office of Revisor of Statutes, K.S.A. 79-4217(a), (b); accessed October 1, 2026. Official text cited
Scope note: Kansas Department of Revenue publications were not read because ksrevenue.gov was not available when AMR checked; values rest on the statutes. Any Kansas Corporation Commission conservation assessment on oil and gas production was not reviewed.

Kentucky

Oil 4.5 percent of market value; natural gas 4.5 percent of gross value.

Levy: Tax on production of crude petroleum (KRS 137.120, oil); natural resources severance and processing tax (KRS 143A.020, natural gas and other natural resources)
Oil: 4.5% of the market value of all crude petroleum produced in the state.
Gas: 4.5% of the gross value of the natural gas severed or processed.
Taxable base: Oil: market value of the crude petroleum, with the tax attaching when it is first transported from the tanks or other receptacle at the place of production. Natural gas: gross value of the natural resource severed or processed.
Reduced rates and exemptions: Credit equal to 4.5% of the market value of crude oil produced from a recovered inactive well (inactive for two consecutive years, or plugged and abandoned, and then producing again) (KRS 137.132). Credit equal to 4.5% of the gross value of natural gas produced from a recovered inactive well (KRS 143A.033).
Royalty owners: The oil tax is imposed ratably on all persons owning any interest in the oil, and every transporter of crude petroleum is liable for it and collects it from the producer (KRS 137.120, 137.140).
Local property tax: Oil and gas reserves are also taxed as property: under KRS 132.820 the Department of Revenue values and assesses oil and gas reserves as a distinct interest in real property, and developed gas property returns list working, royalty and overriding royalty owners for tax billing. KRS 143A.020 says the severance tax is in addition to all other taxes.
As of: KRS 137.120 and KRS 143A.020 show Effective: June 1, 1980 on the statute pages, read from Internet Archive copies dated March 10, 2025 and March 7, 2025.
Source: Kentucky General Assembly, Legislative Research Commission (Kentucky Revised Statutes), KRS 137.120 (read via Internet Archive snapshot March 10, 2025); accessed October 1, 2026. Core rule cited
Scope note: apps.legislature.ky.gov was not available when AMR checked; the KRS sections were read from Internet Archive copies dated March 7, 2025 to April 30, 2025, older than July 1, 2025, so 2025 and 2026 session changes were not checked. Who withholds the natural gas severance tax from royalty owners, and how gross value of natural gas is defined in KRS 143A.010, was not read. The property tax rate applied to assessed oil and gas reserves was not read.

Louisiana

Oil 12.5 percent of value from wells completed before July 2025 and 6.5 percent from newer wells; gas $0.1514 per Mcf for July 2026 to June 2027.

Levy: Severance tax on oil, condensate and natural gas (R.S. 47:633); Oilfield Site Restoration Fee (R.S. 30:87), collected by the Department of Revenue
Oil: 12.5% of value for oil and condensate from wells completed before July 1, 2025 and 6.5% for wells completed on or after July 1, 2025 (Act 295 of 2025, effective July 1, 2025, per LDR). Incapable wells 6.25%, stripper wells 3.125%, and stripper oil is exempt while the 30 day average posted price is under $20 per barrel. Oilfield Site Restoration Fee: 1.5 cents per barrel at an oil price of $60 or less, 3 cents above $60 up to $90, and 4.5 cents above $90.
Gas: Per thousand cubic feet, adjusted each July 1 and never less than 7 cents: $0.1514 per mcf for July 1, 2026 to June 30, 2027 ($0.1052 for July 1, 2025 to June 30, 2026). LDR lists an incapable oil well gas rate of $0.03 per mcf and an incapable gas well gas rate of $0.013 per mcf. Oilfield Site Restoration Fee: three-tenths of one cent per mcf.
Taxable base: Oil: value at the time and place of severance, the higher of gross receipts from the first purchaser less trucking, barging and pipeline fees, or the posted field price (R.S. 47:633(7)(a), archive text of August 8, 2025). Gas: volume in thousand cubic feet at a base pressure of 15.025 pounds per square inch absolute and 60 degrees Fahrenheit.
Reduced rates and exemptions: Stripper oil wells (10 barrels per day or less) pay 3.125% and are exempt in any month the average posted price is under $20 per barrel. Incapable oil wells pay 6.25% of value for all production regardless of completion date (Act 295 of 2025). Oil from inactive wells pays 3.125% and from orphan wells 1.5625% (LDR oil page; the LDR 2025 summary prints 1.565%), for production that starts before October 1, 2028; inactive and orphan gas pay 25% or 12.5% of the full rate. Horizontal wells: the gas exemption lasts 18 months or until payout for wells completed on or after July 1, 2025, versus 24 months for earlier wells (Act 284 of 2025); LDR lists a 1.3% oil rate for horizontal wells completed after July 1, 2025. Tertiary recovery projects approved on or after July 1, 2009 that have reached payout pay 3.25% for wells completed after July 1, 2025 and 6.25% for earlier wells.
Royalty owners: The Department of Revenue states that returns are filed by each severer who withholds tax from royalty payments and by each purchaser who withholds tax from amounts due a seller or owner.
As of: Gas rate $0.1514 per mcf for July 1, 2026 to June 30, 2027 (LDR gas page updated September 28, 2026); oil rates per Act 295 of 2025, effective July 1, 2025.
Source: Louisiana Department of Revenue, Gas page, FY 2027 Gas Tax Rates table and FAQ on oil and condensate rates; accessed October 1, 2026. Core rule cited
Scope note: The current text of R.S. 47:633 was not read: legis.la.gov was not available when AMR checked and the latest archive copy (August 8, 2025) predates Acts 295 and 373 of 2025, while the LDR gas page already cites renumbered provisions such as R.S. 47:633(A)(3)(a). LDR pages say the 6.5% oil rate applies to wells completed after July 1, 2025, while the LDR 2025 legislative summary says on or after July 1, 2025; the enrolled text of Act 295 was not read. Whether producing minerals or oil and gas production are also subject to local ad valorem tax in Louisiana was not read in an official source; the Louisiana Tax Commission site was not available. The Oilfield Site Restoration Fee amounts come from an LDR page updated February 19, 2025; Act 458 of 2025 and Act 662 of 2026 changed parts of R.S. 30:87, so the current fee schedule was not confirmed.

Michigan

Oil 6.6 percent and gas 5 percent of gross cash market value, 4 percent for stripper and marginal oil, plus a fee of 1 percent for 2026.

Levy: Severance tax on oil or gas (1929 PA 48, MCL 205.301 to 205.317); oil and gas fee for monitoring, surveillance, enforcement and administration (MCL 324.61524)
Oil: Severance tax 6.6% of gross cash market value; 4% for stripper well crude oil and crude oil from marginal properties; 4% for oil from carbon dioxide secondary or enhanced recovery projects approved after March 30, 2014. Plus the oil and gas fee, set by Treasury at 1% of gross cash market value for 2026 (statutory maximum 1%).
Gas: Severance tax 5% of gross cash market value; 4% for gas from carbon dioxide secondary or enhanced recovery projects approved after March 30, 2014. Plus the oil and gas fee, set by Treasury at 1% of gross cash market value for 2026 (statutory maximum 1%).
Taxable base: Gross cash market value of the total production, computed when and where the oil or gas was severed, excluding production or proceeds attributable to the state, the United States, or their political subdivisions.
Reduced rates and exemptions: 4% rate for stripper well crude oil and crude oil from marginal properties. 4% rate for oil and gas from carbon dioxide secondary or enhanced recovery projects approved after March 30, 2014. Production or proceeds attributable to the state, the United States or a political subdivision are excluded. No severance tax on income from Devonian or Antrim shale hydrocarbons that qualify for the federal section 45K credit and were acquired through a royalty interest sold by the state. A contractual reimbursement of the tax by a pipeline company or purchaser is not counted in gross cash market value.
Royalty owners: Each owner bears its proportionate share: a pipeline company or common purchaser withholds the tax due by the respective owners from the proceeds or purchase price and pays it to the Department of Treasury.
Local property tax: MCL 205.315 makes the severance tax in lieu of all other state or local taxes on the oil or gas, the property rights in it, and oil and gas leases and the values they create; machinery, pipelines, tanks and other equipment are not exempted.
As of: MCL 205.303 last amended by 2014 PA 82, effective April 1, 2014; the Treasury page (archive copy May 11, 2026) sets the 2026 oil and gas fee at 1%.
Source: Michigan Legislature (Legislative Service Bureau), MCL 205.303(1) to (4) (read via Internet Archive snapshot August 11, 2025); accessed October 1, 2026. Official text cited
Scope note: michigan.gov and legislature.mi.gov was not available when AMR checked, so all four texts were read from Internet Archive copies dated August 11, 2025 to May 11, 2026; changes after those dates were not checked.

Mississippi

Oil and gas 6 percent of value; 1.3 percent for new horizontal wells for up to 30 months; 3 percent for qualifying enhanced recovery oil.

Levy: Oil severance tax (Miss. Code 27-25-503); gas severance tax (Miss. Code 27-25-703); State Oil and Gas Board maintenance fee (Miss. Code 53-1-73)
Oil: Severance tax 6% of the value of the oil at the point of production; 3% for oil from enhanced oil recovery using carbon dioxide piped to the well site or another method approved by the State Oil and Gas Board on or after April 1, 1994; 1.3% for oil from horizontally drilled wells and horizontally drilled recompletion wells whose production commenced on or after July 1, 2013, for 30 months from first sale or until payout, whichever comes first. The separate Oil and Gas Board maintenance fee rate in force was not read.
Gas: Severance tax 6% of the value of the gas at the point of production; 1.3% for gas from horizontally drilled wells and horizontally drilled recompletion wells whose production commenced on or after July 1, 2013, for 30 months from first sale or until payout, whichever comes first. The separate Oil and Gas Board maintenance fee rate in force was not read.
Taxable base: Value of the oil or gas at the point of production, on the entire production in the state regardless of where or to whom it is sold. Under the Department of Revenue gas rule, value is the sales price or market value at the mouth of the well, and marketing and third party transportation deductions may not exceed 8% of the sales price.
Reduced rates and exemptions: 3% oil rate for enhanced oil recovery using carbon dioxide piped to the well site, or another enhanced recovery method approved by the State Oil and Gas Board on or after April 1, 1994. 1.3% rate on oil and gas from horizontally drilled wells and recompletions for 30 months or until payout; this paragraph is repealed from July 1, 2028, but wells whose production commences before then keep the rate. Gas injected for cycling, repressuring, lifting or enhancing oil recovery, gas vented or flared in oil production, and gas condensed into liquids that pay the oil tax are not taxed as gas. A school district's royalty interest in sixteenth section land is exempt from gas severance tax under the Department of Revenue rule. Discovery well, development well, three dimensional seismic, inactive well and coal seam gas incentives in the statute applied only to wells drilled or brought into production in windows that closed between 1990 and 2007.
Royalty owners: For gas, the Department of Revenue rule levies the tax on producers in proportion to their ownership, requires the operator to deduct it from amounts due owners before paying them, and requires a purchaser that pays owners directly to withhold and remit it.
As of: Rates as amended by House Bill 383 (2023 Regular Session), approved by the Governor March 10, 2023 and effective July 1, 2023; read October 1, 2026.
Source: Mississippi Legislature, HB 383 (2023), Section 1 (Miss. Code 27-25-503) and Section 2 (Miss. Code 27-25-703) as amended; accessed October 1, 2026. Core rule cited
Scope note: The codified text of Miss. Code 27-25-503 and 27-25-703 on the official LexisNexis host was not read; the rates come from House Bill 383 (2023) as sent to and approved by the Governor. The Legislature's code section index showed no 2024 or 2025 bill touching 27-25-503 or 27-25-703 and only 2026 Senate Bill 2858, which died in committee, for 27-25-703; extraordinary sessions were not checked. The State Oil and Gas Board maintenance fee in force under Miss. Code 53-1-73 was not read. The fiscal 2015 Legislative Budget Office report shows assessments of .044 per barrel of oil and .005 per 1,000 cubic feet of gas. Whether producing oil and gas or mineral interests in Mississippi are subject to local ad valorem tax was not read in an official source. The oil severance statute text read does not say who withholds the oil tax from royalty owners; the Department of Revenue rule read covers gas only.

Montana

Royalty interests 15.10 percent of value; working interests 0.80 percent in a well’s first 12 months, then mostly 9.30 to 15.10 percent.

Levy: Oil and natural gas production tax (Oil and Gas Production Tax Act, MCA 15-36-301 and following), a single tax enacted to replace the former net proceeds, severance, privilege and license and other extraction taxes. By statute the rates must be adjusted to include the Board of Oil and Gas Conservation privilege and license tax and the oil and gas natural resource distribution account tax, 0.3% combined, and the Department's published rates are 0.3 point above the statutory schedule
Oil: Department of Revenue rates effective January 1, 2024, working interest and nonworking (royalty) interest: first 12 months of production 0.80% and 15.10%; pre-1999 wells after the incentive period 12.80% and 15.10%; post-1999 wells after the incentive period 9.30% and 15.10%; pre-1999 stripper oil 9.30% and 15.10%; post-1999 stripper oil 5.30% on the first 10 barrels and 9.30% above, only in a quarter when the producer's average Montana oil price is under $30, nonworking 15.10%; wells averaging 3 barrels a day or less 0.80% (stripper well exemption) when the producer's quarterly average price is under $54, otherwise 5.30% (stripper well bonus), nonworking 15.10%; horizontal wells first 18 months 0.80% and 15.10%; new or expanded secondary recovery 8.80% and tertiary 6.10%, nonworking 15.10%. The statute sets the same rates 0.3 point lower before the add on (for example 0.5%, 12.5%, 9% and 14.8%).
Gas: Department of Revenue rates effective January 1, 2024, working interest and nonworking (royalty) interest: first 12 months of production 0.80% and 15.10%; pre-1999 wells after the incentive period 15.10% and 15.10%; post-1999 wells after the incentive period 9.30% and 15.10%; pre-1999 stripper wells averaging under 60 Mcf a day 11.30% and 15.10%; horizontally completed wells first 18 months 0.80% and 15.10%. Statutory rates before the 0.3% add on are 0.5%, 14.8%, 9%, 11% and 0.5% for working interests and 14.8% for nonworking interests.
Taxable base: Gross taxable value of production: barrels or cubic feet produced and sold each month, less oil or gas used in operating the well, times the average value at the mouth of the well as determined by the Department of Revenue; a royalty administration fee of up to 25 cents a barrel is not counted as value.
Reduced rates and exemptions: Any interest in production owned by the state or a local government is exempt. Royalties received by an Indian tribe from on reservation production under the Indian Mineral Leasing Act of 1938, by the United States (including as trustee for individual Indians), or by the state, a county or a municipal government in Montana are exempt. Working interest incentive rate of 0.80% (0.5% statutory) for the first 12 months of a new well and the first 18 months of a horizontally completed well. Wells averaging 3 barrels a day or less pay 0.80% when the producer's quarterly average Montana oil price is under $54, otherwise 5.30%. Incremental production from new or expanded secondary recovery (8.80%) and tertiary recovery (6.10%) is taxed at reduced working interest rates, subject to $54 price conditions for secondary recovery and for tertiary projects approved March 23, 2017 to February 18, 2019. For the quarter ending June 30, 2026 the average WTI price was $95.6497, so the price limited tertiary incentive was not available.
Royalty owners: Royalty and other nonworking interest owners bear the nonworking interest rate (15.10% published, 14.8% statutory), which incentives do not reduce; the operator pays the tax for all owners and, unless a contract or lease provides otherwise, deducts each royalty owner's pro rata share from settlements.
Local property tax: MCA 15-36-302 states that the production tax replaced all net proceeds taxes, severance taxes, privilege and license taxes, and other extraction taxes on oil and natural gas production. Separately, MCA 15-6-138 lists machinery, fixtures and equipment used for oil and gas production as class eight property. No source read says whether the mineral interest itself is assessed for local property tax.
As of: Department of Revenue rate tables effective January 1, 2024; Montana Code Annotated 2025; incentive status per the Department's 2nd quarter 2026 incentive letter page, read October 1, 2026.
Source: Montana Department of Revenue, Natural Gas Production Tax Rates and Oil Production Tax Rates tables (effective Jan 1, 2024), Production Incentives, Exempt Royalties; accessed October 1, 2026. Official text cited
Scope note: The Department of Revenue applies a $30 quarterly price condition to post-1999 stripper well rates that does not appear in MCA 15-36-304 as read; its statutory basis was not traced. No source read says whether oil and gas mineral interests themselves are assessed for local property tax in Montana. On October 1, 2026 the Department's pages still pointed to the 2nd quarter 2026 incentive letter; a 3rd quarter 2026 letter was not found.

Nebraska

3 percent of value, 2 percent for stripper oil, plus a conservation charge of up to 1.5 percent.

Levy: Oil and gas severance tax (Neb. Rev. Stat. 57-702 and 57-703); Oil and Gas Conservation Fund charge on the value at the well of oil and gas produced (Neb. Rev. Stat. 57-919)
Oil: Severance tax 3% of the value of nonstripper oil; 2% for oil produced from properties producing stripper oil (base production level of ten or fewer barrels per day). Plus the conservation charge, not to exceed fifteen mills on the dollar (1.5%) of value at the well, fixed by order of the Oil and Gas Conservation Commission; the figure in force was not read.
Gas: Severance tax 3% of the value of natural gas. Plus the conservation charge, not to exceed fifteen mills on the dollar (1.5%) of value at the well, fixed by Commission order; the figure in force was not read.
Taxable base: Value of the oil or natural gas computed immediately after severance at the place where severed; the conservation charge is levied on the value at the well of oil and gas produced, saved, and sold or transported from the premises.
Reduced rates and exemptions: 2% severance rate for oil from properties producing stripper oil, meaning a base production level of ten or fewer barrels per day. Oil or gas used only in severing operations or for repressuring or recycling is not subject to the severance tax. The conservation charge exempts the interests of the United States, the state and its political subdivisions, Indian interests on federally supervised land, and oil and gas used in producing operations or for repressuring or recycling.
Royalty owners: For the conservation charge, royalty and other interest owners are liable to the producer in proportion to their ownership and the person remitting the charge must deduct it from amounts due them; the severance tax is paid by the first purchaser when the oil or gas is sold in the state, or by the severer when sold outside the state.
As of: Statute pages read from Internet Archive copies dated May 22, 2025 (57-701), January 13, 2026 (57-703), January 21, 2026 (57-702) and March 9, 2026 (57-919); 57-703 was last amended by Laws 1983, LB 228.
Source: Nebraska Legislature (Nebraska Revised Statutes), Neb. Rev. Stat. 57-703 (read via Internet Archive snapshot January 13, 2026); accessed October 1, 2026. Core rule cited
Scope note: The conservation charge in force, fixed by order of the Nebraska Oil and Gas Conservation Commission, was not read; nogcc.ne.gov and revenue.nebraska.gov was not available when AMR checked and no archived page stating the current figure was found. nebraskalegislature.gov was not available when AMR checked, so the statutes were read from Internet Archive copies dated May 22, 2025 to March 9, 2026; changes made after those copies, including any from the 2026 session, were not checked. Whether producing oil and gas interests in Nebraska are assessed for local property tax was not read. Whether the first purchaser deducts the severance tax from royalty owners' payments was not stated in the sections read.

New Mexico

Oil: severance 3.75, school 3.15 and conservation 0.19 to 0.24 percent; gas: 3.75, 4 and 0.19 percent; plus a county ad valorem production tax.

Levy: Oil and Gas Severance Tax (NMSA 1978 s. 7-29-4); Oil and Gas Conservation Tax (s. 7-30-4); Oil and Gas Emergency School Tax, a privilege tax (s. 7-31-4); Oil and Gas Ad Valorem Production Tax (s. 7-32-4); Oil and Gas Production Equipment Ad Valorem Tax (s. 7-34-4)
Oil: Severance tax 3.75% of taxable value (s. 7-29-4(A)(2)); emergency school tax 3.15% (s. 7-31-4(A)(1)); conservation tax 0.19%, raised to a total of 0.24% on oil sold in a quarter that follows a quarter in which the average West Texas Intermediate price exceeded $70 per barrel (s. 7-30-4). The TRD rate table for April 1, 2026 through August 31, 2026 applies 0.24% to kind O rows. Plus the ad valorem production tax at county and district rates, for example 1.0423% in the table's AD /2 column for Chaves County district 01, a total rate of 8.1823% for kind O.
Gas: Severance tax 3.75% of taxable value (s. 7-29-4(A)(1)); emergency school tax 4% (s. 7-31-4(A)(3)); conservation tax 0.19% (s. 7-30-4(A)); plus the ad valorem production tax at county and district rates, for example 1.0423% for Chaves County district 01, a total rate of 8.9823% for kind G in the TRD rate table for April 1, 2026 through August 31, 2026.
Taxable base: Taxable value: the value, meaning the actual price received for products at the production unit, less royalties paid or due the United States, New Mexico or an Indian tribe, pueblo or Indian, and less the reasonable expense of trucking to the first place of market (s. 7-29-2(D), s. 7-29-4.1). For the ad valorem production tax, taxable value is 150% of that net value and assessed value applies the uniform assessment ratio (s. 7-32-5).
Reduced rates and exemptions: Stripper well property oil: severance tax 1.875% if the prior calendar year average taxable value of oil was $15 per barrel or less, or 2.8125% if over $15 but not over $18; emergency school tax 1.58% or 2.36% at the same levels (s. 7-29-4(A)(8), (9); s. 7-31-4(A)(4), (5)). Stripper well property gas: severance tax 1.875% if the prior calendar year average taxable value of gas was $1.15 per mcf or less, or 2.8125% if over $1.15 but not over $1.35; emergency school tax 2% or 3% at the same levels (s. 7-29-4(A)(6), (7); s. 7-31-4(A)(6), (7)). Oil from a qualified enhanced recovery project: severance tax 1.875% when the annual average West Texas Intermediate price for the 12 months ending May 31 before the fiscal year was under $28 per barrel (s. 7-29-4(A)(3)). Production from a certified well workover project: severance tax 2.45% when that average price was under $24 per barrel (s. 7-29-4(A)(4), (5)). Production restoration projects: no severance tax for the first ten years of restored production when that average price was under $24 per barrel (s. 7-29-4(B)).
Royalty owners: Every interest owner is liable for each tax to the extent of its interest, and an operator or purchaser paying an interest owner its share must withhold the owner's severance tax from the payment (s. 7-29-4(C), s. 7-29-6).
Local property tax: Yes, through state collected ad valorem taxes on production and equipment. The oil and gas ad valorem production tax is levied on the assessed value of products at the rate certified by the Department of Finance and Administration (s. 7-32-4). It and the oil and gas production equipment ad valorem tax are the full and exclusive measure of ad valorem tax on all interests in the production unit, and any other ad valorem tax on the production unit or its products is void (s. 7-32-5(B), s. 7-34-5).
As of: Statutory rates as compiled in the NMOneSource NMSA chapter 7 file, whose annotations note 2025 amendments effective July 1, 2025; TRD rate table effective with the April 1, 2026 period, through August 31, 2026.
Source: New Mexico Compilation Commission, NMOneSource, NMSA 1978 s. 7-29-2, 7-29-4, 7-29-4.1, 7-29-6, 7-30-4, 7-31-4, 7-32-4, 7-32-5, 7-34-4, 7-34-5; accessed October 1, 2026. Official text cited
Scope note: The TRD rate table read covers April 1, 2026 through August 31, 2026; no table for periods from September 1, 2026 was posted on the filing page when read, so the current ad valorem production rates and the oil conservation rate for the quarter that includes October 1, 2026 were not confirmed. The TRD rate table does not define its product kinds O, H, G and C; this record reads O as oil and G as natural gas only because their school tax rates match the statutory oil and gas rates. Whether any price triggered reduced rate (stripper, enhanced recovery, workover, restoration) applies in fiscal year 2026-27 was not read from a TRD notice.

North Dakota

Oil 5 percent gross production tax plus 5 percent extraction tax; gas $0.0655 per Mcf for July 2026 to June 2027.

Levy: Oil and gas gross production tax (N.D.C.C. ch. 57-51); oil extraction tax (N.D.C.C. ch. 57-51.1)
Oil: Gross production tax 5% of gross value at the well (s. 57-51-02) plus oil extraction tax 5% of gross value at the well (s. 57-51.1-02(1)). For wells within reservation boundaries, on trust properties or straddle wells on reservation trust land, the extraction tax rises to 6% after the average crude price exceeds the indexed trigger price (set at $90 in the statute) for three consecutive months, unless the tribe opts out (s. 57-51.1-02(2), (3)).
Gas: Flat rate per mcf of taxable production, reset each July 1: $.0655 per mcf for July 1, 2026 through June 30, 2027, computed as $.04 times a gas base rate adjustment of 1.6374 (Tax Commissioner notice dated June 1, 2026; s. 57-51-02.2). The prior year rate was $.0555 per mcf.
Taxable base: Oil: gross value at the well, which is the price under an arm's length contract between producer and purchaser less transportation costs from the point of production to the point of sale, with fallback methods when there is no such contract (s. 57-51-02.3). Gas: taxable production in mcf times the gas tax rate (s. 57-51-02.2).
Reduced rates and exemptions: Oil from a stripper well property or individual stripper well is exempt from the oil extraction tax (s. 57-51.1-03(2)); stripper limits run from 10 barrels per day for shallow wells up to 35 barrels per day for deep Bakken or Three Forks wells (s. 57-51.1-01(10), (11)). Oil extraction tax is reduced to 2% on the first 300,000 barrels produced in the first 36 months from wells drilled and completed outside the Bakken and Three Forks formations (s. 57-51.1-03(4)). Restimulation wells certified after August 1, 2023 pay 2% oil extraction tax on the first 75,000 barrels or for 18 months, whichever comes first (s. 57-51.1-03(5)). The first 250,000 barrels in the first 36 months from a certified development incentive well drilled and completed before July 1, 2028 are exempt from the oil extraction tax (s. 57-51.1-03(6)). Incremental production from certified secondary recovery projects is exempt from oil extraction tax for 5 years and from tertiary projects for 10 years, with other periods for some carbon dioxide projects (s. 57-51.1-03(3)). Gas: shallow gas is exempt for its first 24 months (s. 57-51-02.4), and gas collected at the well site under a system to avoid flaring is exempt for two years and thirty days (s. 57-51-02.6).
Royalty owners: Both taxes attach to the whole production including the royalty interest, and the purchaser pays the tax and deducts it in settlement with the producer or royalty owner (s. 57-51-02, s. 57-51-05(2), s. 57-51.1-02(1), s. 57-51.1-05).
Local property tax: In lieu. Payment of the gross production tax is in lieu of all ad valorem taxes on property rights in producing oil or gas, producing leases, equipment used at the producing well, and oil and gas produced on which the tax was paid; other interests in the land are taxed as other property (s. 57-51-03). The Tax Commissioner states the gross production tax is imposed instead of property taxes on oil and gas producing properties.
As of: Gas rate effective July 1, 2026 through June 30, 2027 per notice dated June 1, 2026; oil rates per N.D.C.C. s. 57-51-02 and 57-51.1-02 as published on ndlegis.gov when read October 1, 2026.
Source: North Dakota Legislative Branch, N.D.C.C. s. 57-51-02, 57-51-02.2, 57-51-02.3, 57-51-03, 57-51-05; accessed October 1, 2026. Official text cited
Scope note: The indexed oil trigger price for calendar year 2026, which matters only for reservation, trust land and straddle wells, was not read. Which tribes, if any, have opted out of the 6% trigger rate or opted into the reduced rates was not read.

Ohio

Oil 10 cents per barrel; gas 2.5 cents per Mcf; plus a small regulatory assessment on non domestic wells.

Levy: Severance tax (R.C. 5749.02); oil and gas regulatory cost recovery assessment (R.C. 1509.50), which the Department of Taxation describes as not part of the severance tax but reported on the severance tax return
Oil: Severance tax of 10 cents per barrel, plus a regulatory cost recovery assessment of 10 cents per barrel on production of non domestic wells.
Gas: Severance tax of 2.5 cents per Mcf (thousand cubic feet), plus a regulatory cost recovery assessment of half a cent per Mcf on production of non domestic wells.
Taxable base: Volume severed: a flat amount for each barrel of oil and each thousand cubic feet of natural gas extracted from the soil or water of Ohio, imposed on the severer.
Reduced rates and exemptions: Natural resources severed from an exempt domestic well are not subject to the severance tax (R.C. 5749.03). Since October 1, 2017 gas severed by an exempt domestic well is exempt, replacing the former $1,000 exemption for resources severed from the severer's own land (H.B. 49 of 2017). The regulatory cost recovery assessment applies to certain non exempt well owners and is based on production of non domestic wells.
Local property tax: Yes. The Tax Commissioner states that under R.C. 5713.05 and 5713.06 oil and natural gas reserves, or the value of any right to them, are assessed and taxed as real property, and that this tax is not a production or severance tax. For tax year 2026 the uniform formula values oil at $4,400 per barrel of average daily production (one barrel or more; $2,640 below one barrel) and gas at $180 per Mcf of average daily production (8 Mcf or more; $90 below).
As of: Rates as stated in the Department of Taxation annual report for fiscal year 2025, whose comparison data are as of August 6, 2025 and which notes that H.B. 96 of 2025 changed only the coal rate. Real property valuation formula for tax year 2026 adopted April 27, 2026.
Source: Ohio Department of Taxation, Annual Report FY 2025, Severance Tax chapter: Tax Rates (R.C. 5749.02), Exemptions and Credits, Special Provisions, History of Major Changes (report pages 84 to 86); accessed October 1, 2026. Official text cited
Scope note: codes.ohio.gov and the Ohio legislature hosts was not available when AMR checked, and the archive holds no copy of the R.C. 5749.02 version effective September 30, 2025; the statute text read is the 2017 version. The rates rely on the Department of Taxation report, which notes H.B. 96 changed only the coal rate. R.C. 1509.50 (regulatory cost recovery assessment) was not read directly; its rates come from the Department of Taxation report. No source read states whether royalty owners bear any share of the severance tax or the assessment.

Oklahoma

Gross production tax 7 percent, 5 percent for a well’s first 36 months, plus a 0.095 percent excise tax and two small fees.

Levy: Gross production tax (68 O.S. s. 1001); petroleum excise tax, an additional excise tax on oil and on natural gas and casinghead gas (68 O.S. s. 1101 and 1102); Oklahoma Energy Resources Board fee and Sustaining Oklahoma's Energy Resources fee, both reported on OTC Form 341
Oil: Gross production tax 7% of gross value, or 5% for the first 36 months from the month of first production (68 O.S. s. 1001(B)). Petroleum excise tax .095 of 1% of gross value (68 O.S. s. 1101); 2026 SB 1280, effective July 1, 2026, keeps this rate through June 30, 2031, after which it becomes .085 of 1%. OTC Form 341 (created 2022-06) also lists an Oklahoma Energy Resources Board fee of taxable value times 0.001 and a Sustaining Oklahoma's Energy Resources fee of $0.0035 per barrel of taxable volume.
Gas: Gross production tax 7% of gross value, or 5% for the first 36 months from the month of first production (68 O.S. s. 1001(B)). Petroleum excise tax .095 of 1% of gross value (68 O.S. s. 1102), kept through June 30, 2031 by 2026 SB 1280. OTC Form 341 (created 2022-06) also lists the Oklahoma Energy Resources Board fee of taxable value times 0.001 and a Sustaining Oklahoma's Energy Resources fee of $0.00015 per mcf of taxable volume.
Taxable base: Gross value of the production (68 O.S. s. 1001(B)). OTC Form 341 describes gross value as the gross proceeds realized from the first sale, including premiums, without any deduction for costs. Producers may deduct qualifying natural gas marketing costs from gross value (68 O.S. s. 1001.4).
Reduced rates and exemptions: New wells: 5% instead of 7% for the first 36 months from the month of first production (s. 1001(B)(3)). Secondary and tertiary recovery projects approved or starting on or after July 1, 2022: production exempt for up to 5 years, paid as refunds capped at $15 million per fiscal year (s. 1001(D), (F)). Recovery projects on wells from the Corporation Commission orphaned well list: 50% reduction of the 5% rate for 36 months, with a $25,000 surety per well (s. 1001(D)(5)). Wells drilled but not completed as of July 1, 2021 and completed with recycled water on or after July 1, 2022: exemption for 24 months from first sales in proportion to recycled water used (s. 1001(E)); the OTC says 2026 HB 3986 removes the date requirement effective January 1, 2027. Economically at-risk leases (wells averaging 10 barrels of oil or 60 mcf of gas or less per day that run at a loss or at a profit below the gross production tax paid, or oil leases under $50 per barrel and gas leases under $3.50 per MMBtu on a monthly average): refund of 6/7 of a 7% tax or 4/5 of a 5% tax for the prior calendar year, capped at $10 million per year (s. 1001.3a). Producers may deduct natural gas marketing costs, such as compressing, dehydrating, sweetening and delivering the gas, from gross value (s. 1001.4).
Royalty owners: The tax attaches to the royalty interest (68 O.S. s. 1001(C)), and on oil and gas sold at the time of production the purchaser pays it and deducts it in settlement with the producer or royalty owner (68 O.S. s. 1009(D)).
Local property tax: In lieu. Payment of the gross production tax is in full and in lieu of all state and local taxes on property rights in the minerals, on producing oil and gas leases, on machinery and equipment used in and around producing wells, and on the oil and gas during the tax year produced (68 O.S. s. 1001(K)). Other interests in the land, and oil in storage on the assessment date, are taxed as other property.
As of: Gross production tax rates per 68 O.S. s. 1001 as last amended by Laws 2025, c. 51, effective July 1, 2025; petroleum excise rate per 2026 SB 1280, effective July 1, 2026, approved by the Governor May 1, 2026.
Source: Oklahoma Legislature, 68 O.S. s. 1001(B), (C), (D), (E), (F), (K); s. 1001.3a; s. 1001.4; s. 1009(D); s. 1101; s. 1102; accessed October 1, 2026. Official text cited
Scope note: The compiled Title 68 file on oklegislature.gov was last modified December 31, 2025, so it does not show 2026 session changes; the 2026 changes found (SB 1280, HB 3986, SB 227) come from enrolled SB 1280 and the OTC 2026 summary, and the enrolled texts of HB 3986 and SB 227 were not read. 68 O.S. s. 1001(B)(4) would cut the first 36 month rate to 2% only if State Question No. 795 is approved; whether that ever occurred was not read. The OERB and SOER fee amounts come only from OTC Form 341, created 2022-06; their statutes and any later change were not read.

Pennsylvania

No severance tax; producers pay an annual impact fee per unconventional gas well.

Levy: No traditional severance tax on natural gas production; instead the Unconventional Gas Well Fee (the Act 13 of 2012 impact fee, 58 Pa.C.S. ch. 23), charged per unconventional gas well to producers
Oil: None
Gas: Not a percentage or per unit rate. Fixed annual fee per unconventional gas well. Calendar year 2025 schedule published by the Public Utility Commission (average annual NYMEX price $3.427, CPI adjustment 3.9%): horizontal wells $59,700 in year 1, $47,800 in year 2, $35,800 in year 3, $23,900 in years 4 to 10 and $12,100 in years 11 to 15; vertical producing wells $11,900, $9,600, $7,200, then $4,800 in years 4 to 10. The statutory base schedule before CPI adjustment steps up with the price band, for example year 1 runs from $40,000 at a price of $2.25 or less to $60,000 above $5.99.
Taxable base: Each spud unconventional (shale) gas well per calendar year, set by years since spud, well type (horizontal or vertical) and the average annual NYMEX natural gas price for the year; the fee does not vary with the volume of gas extracted.
Reduced rates and exemptions: Vertical unconventional wells pay 20% of the horizontal well fee and owe nothing in years 11 to 15. Vertical wells are charged only for a year in which they average more than 90,000 cubic feet in any one month; active vertical wells are charged for 10 years. The fee is suspended for a well that is capped or produces no more than a stripper well (90,000 cubic feet a day) within two years after paying the initial fee, and resumes in any year it produces more. Fee payments end once the producer certifies that the well has ceased production and has been plugged.
Local property tax: A 2014 Independent Fiscal Office report states that Pennsylvania natural gas reserves are not included in the assessed value of real property and that Pennsylvania does not levy a personal property tax. No current statute or assessment agency text on this point was read.
As of: Fee schedule for calendar year 2025, published in the Pennsylvania Bulletin on January 24, 2026 (56 Pa.B. 580); 2025 fees were remitted in April 2026. Statute text is from an archive snapshot of July 15, 2024.
Source: Pennsylvania Public Utility Commission, notice in the Pennsylvania Bulletin, 56 Pa.B. 580, Unconventional Gas Well Fees for Calendar Year 2025 table and note (3); accessed October 1, 2026. Core rule cited
Scope note: No source read states whether any state level levy applies to oil production in Pennsylvania. The Act 13 fee applies only to unconventional gas wells. The statute was read from an Internet Archive snapshot of July 15, 2024 because palegis.us and legis.state.pa.us was not available when AMR checked. Amendments after that date were not checked. The real property statement comes from a 2014 Independent Fiscal Office report that cites CCH. No current statute, court decision or county assessment guidance was read. puc.pa.gov was not available when AMR checked, so the PUC press release and online fee schedule were not read. The Pennsylvania Bulletin notice was used instead. No source read says whether producers may charge any part of the fee to royalty owners.

South Dakota

4.5 percent of taxable value plus a 0.24 percent conservation tax.

Levy: Energy minerals severance tax (SDCL 10-39A-1); conservation tax on severance of energy minerals (SDCL 10-39B-2)
Oil: Severance tax 4.5% of taxable value, plus conservation tax of 2.4 mills (0.24%) of taxable value.
Gas: Severance tax 4.5% of taxable value, plus conservation tax of 2.4 mills (0.24%) of taxable value. Natural gas is an energy mineral under SDCL 10-39A-1.1.
Taxable base: Taxable value: the sale price of energy minerals sold, or the market value of minerals severed and saved but not sold, in each case less any rental or royalty payment belonging to the United States, the state or its political subdivisions; where there is a posted field price at the point of production, that price. The tax applies when the mineral is sold or consumed, whichever occurs first.
Reduced rates and exemptions: Rental and royalty payments belonging to the United States, the state or its political subdivisions are deducted from taxable value. The conservation tax is paid by the operator, who may not pass it on to the owner of the energy minerals.
Royalty owners: Owners, defined to include landowner royalty and overriding royalty owners, designate an operator who withholds the severance tax from each owner's distributions and pays it to the state, subject to contrary contract terms; the conservation tax may not be passed on to owners.
Local property tax: SDCL 10-39A-7 says the severance tax is in lieu of other occupational, excise, income, privilege, franchise and mineral taxes levied by the state, but is not in lieu of sales, use, and property taxes.
As of: Codified Laws read on sdlegislature.gov October 1, 2026; SDCL 10-39A-1 last amended by SL 2008, ch 37 and SDCL 10-39B-2 last amended by SL 2021, ch 49.
Source: South Dakota Legislature, Legislative Research Council (Codified Laws), SDCL 10-39A-1, 10-39A-1.1, 10-39A-2, 10-39A-2.1, 10-39A-3.1, 10-39A-4, 10-39A-7; accessed October 1, 2026. Official text cited
Scope note: Whether South Dakota assesses producing oil and gas interests for local property tax was not read.

Texas

Oil 4.6 percent of market value; gas 7.5 percent; condensate at the oil rate; small cleanup fees.

Levy: Oil Production Tax (Tax Code ch. 202); Gas Production Tax (Tax Code ch. 201), which also taxes condensate (s. 201.055) and other liquid hydrocarbons recovered from gas (s. 201.054); Oil Field Clean-Up Fee on taxable barrels of oil; Oil-Field Cleanup Regulatory Fee on Natural Gas
Oil: 4.6% of market value, or 4.6 cents per barrel of 42 standard gallons, whichever results in the greater tax (s. 202.052(a)). Condensate is taxed at the oil rate (s. 201.055). The Comptroller also lists an Oil Field Clean-Up Fee of $0.00625 per taxable barrel for report periods September 2015 and later.
Gas: 7.5% of market value of gas produced and saved (s. 201.052(a)); liquid hydrocarbons other than condensate are taxed at the same rate (s. 201.054). The Comptroller also lists an Oil-Field Cleanup Regulatory Fee on Natural Gas of $.000667 per 1,000 cubic feet of taxable gas.
Taxable base: Oil: market value, meaning the actual market value plus any bonus, premium or other thing of value paid for the oil (s. 202.053). Gas: value at the mouth of the well, computed as the producer's gross cash receipts minus its actual marketing costs (s. 201.101(a)).
Reduced rates and exemptions: Oil from a new or expanded enhanced recovery project is taxed at 2.3% instead of 4.6% (s. 202.052(b)), with an additional 50% reduction for qualifying projects that use captured anthropogenic carbon dioxide (s. 202.0545). Oil and gas from wells the Railroad Commission designates as two-year inactive wells qualify for a five-year severance tax exemption (s. 202.056). High-cost gas from wells spudded or completed after August 31, 1996 gets a reduced rate for up to 120 months or until the reduction equals 50% of drilling and completion costs (s. 201.057(c)). Low-producing oil leases (under 15 barrels per well per day) and gas wells (90 mcf per day or less) get credits of 25%, 50% or 100% of the tax as the certified three month average taxable price in 2005 dollars falls: 25% when over $25 but not over $30 per barrel or over $3 but not over $3.50 per mcf, and 100% at $22 per barrel or $2.50 per mcf or less (s. 202.058, s. 201.059). Oil and gas from certified restimulation wells is exempt for up to 36 months, ending earlier once exempted tax reaches the lesser of restimulation costs or $750,000 (s. 202.062, effective January 1, 2026). Oil and gas from reactivated orphaned wells qualify for a severance tax exemption for the certified operator (s. 202.060).
Royalty owners: Royalty owners bear the tax ratably, and producers or purchasers are authorized and required to withhold the proportionate tax from payments to them (s. 202.156, s. 201.205).
Local property tax: Yes, separately. The Property Tax Code defines real property to include a mineral in place (s. 1.04), and s. 23.175 governs how appraisal offices value a real property interest in oil or gas in place from projected income. The state production taxes are classified as occupation taxes (s. 202.351, s. 201.401); no source read makes them a substitute for local property tax.
As of: s. 202.052 as amended effective January 1, 2006 and s. 201.052 as amended effective October 1, 2001, read in archive snapshots of November 18, 2025 and December 8, 2025; Comptroller rate pages as captured August 13, 2026.
Source: Texas Legislature, Texas Constitution and Statutes, Tax Code s. 202.052, 202.053, 202.156, 202.351 (read via Internet Archive snapshot November 18, 2025); accessed October 1, 2026. Official text cited
Scope note: Tax Code chapters 202, 201, 1 and 23 were read from Internet Archive snapshots dated November 18, 2025, December 8, 2025, December 5, 2025 and December 3, 2025 because statutes.capitol.texas.gov was not available when AMR checked, so any later amendment was not checked. Whether low value mineral interests are exempt from local property tax was not read.

Utah

3 percent of value up to $13 a barrel or $1.50 per Mcf and 5 percent above that, plus a 0.2 percent conservation fee.

Levy: Oil and gas severance tax (Utah Code 59-5-102); oil and gas conservation fee (Utah Code 40-6-14); both collected by the State Tax Commission
Oil: Severance tax of 3% of taxable value up to and including the first $13 per barrel and 5% of the value from $13.01 per barrel; natural gas liquids 4% of taxable value; plus the conservation fee of 0.2% (0.002) of value.
Gas: Severance tax of 3% of taxable value up to and including the first $1.50 per Mcf and 5% of the value from $1.51 per Mcf; plus the conservation fee of 0.2% of value.
Taxable base: Taxable value of each owner's interest in oil or gas produced and saved, sold, or transported from the field where it was produced; working, royalty and other interests are all taxed; oil or gas shipped out of state counts as sold, and stockpiled product is taxed when sold, transported or delivered, or after two years.
Reduced rates and exemptions: No tax on stripper well production (oil wells under 20 barrels a day and gas wells under 60 Mcf a day, per the Division), unless the exemption would prevent the tax from being deductible for federal tax purposes. No tax on the first 12 months of production from wildcat wells or the first 6 months from development wells started after January 1, 1990. Interests of the United States, the state or its political subdivisions, and Indians or Indian tribes in production from land under United States jurisdiction are not taxed. The tax rate is cut by 50% on incremental production from an enhanced recovery project. Recompletion or workover credit of 20% of expenses, capped at $30,000 per well per calendar year (2021 statute text and Division summary).
Royalty owners: Royalty owners owe severance tax on their share in proportion to their interest; under the 2021 statute text the producer reports and pays on behalf of each owner and deducts the tax from amounts due to the other owners.
Local property tax: Yes. The Property Tax Division of the State Tax Commission assesses the fair market value of oil and gas properties each year as of January 1 using a discounted cash flow model, and each county sets the tax rate (Utah Code 59-2-201). The 2021 statute text says the severance tax is in addition to all other taxes provided by law.
As of: Statute text read is the version effective July 1, 2021 (Amended by Chapter 280, 2021 General Session), from an archive snapshot of April 3, 2025; the Division of Oil, Gas and Mining summary is undated and was read October 1, 2026.
Source: Utah Division of Oil, Gas and Mining, Utah Oil and Gas Production Taxes Summary, sections A (Conservation Fee), B (Severance Tax), C (Property Tax); accessed October 1, 2026. Core rule cited
Scope note: The current text of 59-5-102 could not be read. The le.utah.gov page captured September 7, 2026 names a newer default version file, C59-5-S102_2025010120250507, which the archive does not hold, and le.utah.gov was not available when AMR checked. Rates are confirmed only in the 2021 version and the undated Division summary. tax.utah.gov was not available when AMR checked, so no State Tax Commission rate page, form or instruction was read. Utah Code 40-6-14 (conservation fee) and 59-2-201 (property assessment) were not read directly; both come from the Division summary. The stripper well thresholds (20 barrels and 60 Mcf a day) come from the Division summary; the statutory definition in 59-5-101 was not read.

Virginia

No state severance tax found; counties and cities may tax gas at up to 1 percent under each of three local options.

Levy: No state severance tax was identified in the sources read. Counties and cities may levy local license (severance) taxes on gas: the local gas severance tax (Va. Code 58.1-3712), the local gas road improvement and Virginia Coalfield Economic Development Authority tax (58.1-3713), and an additional local tax on gas (58.1-3713.4). The former local oil severance tax authority (58.1-3712.1) was repealed by Acts 2016, c. 305.
Oil: No current local oil severance tax authority was found: Va. Code 58.1-3712.1, which allowed counties and cities a license tax of one-half of one percent of gross receipts from oil, was repealed by Acts 2016, c. 305.
Gas: Local option, set by each county or city: up to 1% of gross receipts under 58.1-3712, up to 1% under 58.1-3713 (no tax under 58.1-3713 on or after January 1, 2028), and up to an additional 1% under 58.1-3713.4.
Taxable base: Gross receipts from the sale of gases severed in the county or city, measured as fair market value when the gas is used or sold for use there or placed in transit for shipment.
Reduced rates and exemptions: Producers severing gas in connection with coal mining may not deduct depreciation, compression, marketing fees, overhead, maintenance, transportation fees or personal property taxes in computing fair market value. The 58.1-3713 road improvement tax may not be imposed on or after January 1, 2028. A commissioner of the revenue may agree with a taxpayer on how fair market value is calculated.
As of: Code of Virginia read on law.lis.virginia.gov October 1, 2026; 58.1-3713 was last amended by 2025, c. 116 and 58.1-3712 by 2014, cc. 48, 179.
Source: Virginia General Assembly, Legislative Information System (Code of Virginia), Va. Code 58.1-3712; accessed October 1, 2026. Core rule cited
Scope note: No Virginia Tax or Code source read states outright that Virginia has no state level severance tax on oil or gas; the statement rests on the local authorizing statutes read. Which counties and cities currently levy the gas taxes, and at what rates, was not read. Whether producing oil and gas or mineral interests are assessed for local real property tax in Virginia was not read. Who bears or withholds the local gas taxes as between operators and royalty owners was not read.

West Virginia

5 percent of gross value; 0 percent for low volume wells in 2026 and 2027; the smallest wells exempt.

Levy: Severance tax on the privilege of severing natural gas or oil (W. Va. Code 11-13A-3a); the Tax Division also reports a 5.0% severance tax on coalbed methane wells whose proceeds go to local governments
Oil: 5% of gross value for oil from wells that averaged more than 10 barrels a day in the prior calendar year and for all horizontal shale wells. For non shale wells that averaged between 0.5 and 10 barrels a day the statutory special rate is 2.5%, but it is reduced to 0% for taxable years 2026 and 2027 because the Oil and Gas Abandoned Well Plugging Fund held at least $6 million on June 1. Wells under 0.5 barrel a day are exempt.
Gas: 5% of gross value for gas from wells that averaged more than 60,000 cubic feet a day in the prior calendar year and for all horizontal shale wells. For non shale wells that averaged between 5,000 and 60,000 cubic feet a day the statutory special rate is 2.5%, reduced to 0% for taxable years 2026 and 2027. Wells under 5,000 cubic feet a day are exempt. The Tax Division states the same 5.0% rate for natural gas liquids.
Taxable base: Gross value of the natural gas or oil produced, as shown by the gross proceeds derived from its sale by the producer; the tax is imposed on the person exercising the privilege of severing.
Reduced rates and exemptions: Gas from wells averaging under 5,000 cubic feet a day, and oil from wells averaging under 0.5 barrel a day, in the prior calendar year is exempt. Free natural gas provided to a surface owner is exempt. Production is exempt for up to 10 years from a well returned to production after five consecutive years without marketable production. Non shale low volume wells (5,000 to 60,000 cubic feet or 0.5 to 10 barrels a day) carry a 2.5% special rate, set at 0% for taxable years 2026 and 2027 by Administrative Notices 2025-05 and 2026-05. Horizontal shale wells in the same low volume bands still pay 5%.
Local property tax: Yes. Oil and natural gas properties, producing and non producing, are also appraised for ad valorem property tax: the Tax Division files annual valuation variables for that purpose, including a minimum working interest appraisal of $500 per well, a flat rate royalty multiplier, and per acre values for non producing property. The severance statute says the tax is in addition to all other taxes imposed by law.
As of: Rate structure effective for taxable periods beginning on or after January 1, 2020 (statute snapshot of November 17, 2025). Special low volume rate of 0% for taxable year 2026 (notice issued July 1, 2025) and taxable year 2027 (notice issued July 8, 2026).
Source: West Virginia Legislature, W. Va. Code 11-13A-3a(a), (b)(1) to (3), (c), (e) (read via Internet Archive snapshot November 17, 2025); accessed October 1, 2026. Official text cited
Scope note: code.wvlegislature.gov was not available when AMR checked, so the statute was read from an Internet Archive snapshot of November 17, 2025. A 2026 committee substitute for HB 5398 proposed amending 11-13A-3a on the plugging fund; whether it was enacted was not checked. No source read states whether royalty owners bear any share of the severance tax or whether producers deduct it from royalty payments. The tax year 2027 valuation variables read are the tentative ones filed July 1, 2026; the final variables due by September 1, 2026 were not read.

Wyoming

6 percent of the value of oil and gas; 4 percent for stripper and tertiary oil.

Levy: Severance tax on crude oil, lease condensate and natural gas (W.S. 39-14-203 and 39-14-204), totaling 6%, of which 1.5% is imposed by Wyoming Constitution article 15, section 19
Oil: 6% of the value of the gross product, made up of 1.5% + 0.5% + 2% + 2% (W.S. 39-14-204(a)). The DOR rate table for January 1, 2025 through December 31, 2026 lists oil base 6.0%, lease condensate 6.0%, stripper (10 barrel code) 4.0%, tertiary 4.0%, and 4.0% and 5.0% codes that wells drilled after December 31, 2025 are not eligible for.
Gas: 6% of the value of the gross product (W.S. 39-14-204(a)). The DOR rate table for January 1, 2025 through December 31, 2026 lists natural gas base 6.0%, and 4.0% and 5.0% codes that wells drilled after December 31, 2025 are not eligible for.
Taxable base: Value of the gross product extracted: fair market value determined after the production process is completed, and expenses incurred by the producer before the point of valuation are not deductible (W.S. 39-14-203(a)(i), (b)(ii)).
Reduced rates and exemptions: Stripper production is exempt from the 2% levied under W.S. 39-14-204(a)(iii), leaving 4% (W.S. 39-14-205(a)); stripper means a property averaging no more than 10 barrels per well per day in the prior year if the price received was $20 or more, or 15 barrels if less (W.S. 39-14-201(a)(xxiv)). Wells drilled on or after July 1, 2020 and before December 31, 2025: the 2% under (a)(iv) is exempt for the first 6 months and cut to 1% for the next 6 months, only if at first production the 12 month average WTI price was under $50 per barrel (oil) or the Henry Hub price under $2.95 per thousand cubic feet (gas) (W.S. 39-14-205(n)). Oil from previously shut-in wells is exempt from the taxes under (a)(ii), (iii) and (iv) for 60 months of renewed production or until the price received averages $25 or more for 6 months (W.S. 39-14-205(h)); the DOR table marks the renewed production code as currently invalid. Tertiary production from projects certified after July 1, 2026 and before July 1, 2031 is exempt from the 2% under (a)(iii) for 5 years (W.S. 39-14-205(q)). Severance tax paid on carbon dioxide injected for tertiary oil recovery is credited against the tax on the oil produced (W.S. 39-14-205(d)). Gas vented or flared under commission authority, or reinjected or consumed on the lease before sale, has no value and is exempt (W.S. 39-14-205(j)).
Royalty owners: Any person owning an interest in the production is liable for the severance tax to the extent of that interest and a taxpayer paying it may deduct the tax from amounts due to the interest owners, while for ad valorem tax on production the lessor is liable only for its retained interest, royalty or otherwise (W.S. 39-14-203(c)).
Local property tax: Yes, in addition. The severance tax is in addition to all other taxes, including the ad valorem taxes in W.S. 39-13-101 through 39-13-111 (W.S. 39-14-203(a)(i)). The gross product of minerals is taxed at 100% of fair market value (W.S. 39-11-101(a)(xvii)), and producers pay the county ad valorem tax on mineral production monthly to the department at no less than the prior year county mill levy (W.S. 39-13-113).
As of: W.S. 39-14-204 and 39-14-205 as published by the Wyoming Legislature in the title 39 file read October 1, 2026 (server date May 8, 2026); DOR severance tax rate table for January 1, 2025 through December 31, 2026.
Source: Wyoming Legislature, W.S. 39-14-203, 39-14-204, 39-14-205, 39-14-201(a)(xxiv), 39-13-113, 39-11-101(a)(xvii); accessed October 1, 2026. Official text cited
Scope note: The DOR rate table does not cite the statute behind its 4.0% and 5.0% oil and gas codes; this record reports them only as listed. The DOR table lists a tertiary oil rate of 4.0% without a statute reference; W.S. 39-14-205(q) covers only projects certified after July 1, 2026, so the basis of the table's tertiary code was not confirmed.

Income tax on royalty income

Scroll the table sideways to see every column.

Broad personal income tax and royalty income, 50 states and D.C., checked October 6, 2026
		Royalty income note	Source	Evidence
Alabama	Yes	Nonresidents owe Alabama tax on income from property owned in Alabama, residents are taxed on income from sources within and outside Alabama, and the 2025 Form 40NR instructions report royalties from mineral leases on Schedule E with royalties from property located in Alabama listed separately.	Code of Alabama s. 40-18-2(a)(1) and (a)(6)	Official text cited
Alaska	No	Alaska has no individual income tax, because the state net income tax in AS 43.20 does not apply to an individual, so an individual's royalty income is not taxed by the state.	AS 43.20.012(a)(1)	Official text cited
Arizona	Yes	Nonresidents owe Arizona tax on all income derived from Arizona sources and the 2025 Form 140NR instructions put rent or royalty income earned on Arizona properties in the Arizona column, while the tax reaches the entire taxable income of every resident.	A.R.S. 43-1091(A)	Official text cited
Arkansas	Yes	Nonresidents who earn income from real or tangible personal property located in Arkansas owe Arkansas income tax while their income from intangible property is not taxed, and residents report income received as Arkansas residents no matter where it was earned.	Regulation 1997-4, rules 1.26-51-202(a), 2.26-51-202(a) and 1.26-51-202(d) (PDF page 38)	Core rule cited
California	Yes	Residents are taxed on all income from all sources and nonresidents only on California source income, including rents and royalties related to property located in California, and the Form 592 instructions list royalties among payments subject to withholding at 7%, or a reduced amount the FTB authorizes, once California source payments exceed $1,500 in a calendar year.	2025 Schedule CA (540NR) instructions, Column E California Amounts, introduction and Section B, Line 5	Official text cited
Colorado	Yes	Nonresidents owe Colorado tax on income derived from Colorado sources, the Department lists rents and royalties from real and tangible personal property located in Colorado as Colorado source income, and part-year residents are taxed on all income from their period of Colorado residency.	Income Tax Topics: Part-Year Residents and Nonresidents (revised February 2024), introduction (page 1) and Colorado-Source Income table (page 3)	Core rule cited
Connecticut	Yes	Nonresidents report rents and royalties from real property located in Connecticut as Connecticut source income whether or not the property is used in a business, and part-year residents report income from all sources earned while they were Connecticut residents.	2025 Form CT-1040NR/PY instructions, Line 10 Rental Real Estate, Royalties, Partnerships, S Corporations, Trusts, Etc. (PDF page 15) and Schedule CT-SI guidance (PDF page 12)	Official text cited
Delaware	Yes	Nonresidents owe Delaware tax on income attributable to the ownership of any interest in real or tangible personal property in Delaware, the 2025 PIT-NON instructions put rents and royalties from property located in Delaware in the Delaware source column, and part-year residents include all income from any source during Delaware residency.	30 Del. C. s. 1121 and s. 1124(b)(2)	Official text cited
District of Columbia	Yes	DC imposes its income tax on the taxable income of every resident, and the Home Rule Act bars the DC Council from imposing any tax on any portion of the personal income of an individual who is not a DC resident.	D.C. Code s. 47-1806.03(a)(11)	Official text cited
Florida	No	Florida does not impose a personal income tax, and its constitution bars a state tax on the income of natural persons who are residents or citizens beyond amounts creditable against a similar federal or state tax, so an individual's royalty income is not taxed by the state.	Page 2, Other Taxes and Fees	Official text cited
Georgia	Yes	Full-year residents are taxed on all income regardless of source, nonresidents owe Georgia tax on income from Georgia sources, and the Department rule says a nonresident's gross income from rents includes all rents from real or personal property located in Georgia.	Ga. Comp. R. and Regs. 560-7-8-.01(1)(b) and (1)(b)6, Rents	Core rule cited
Hawaii	Yes	Residents are taxed on income from all sources, while nonresidents are taxed on Hawaii source income only and report rents and royalties with situs in Hawaii, where income from real or tangible personal property is sourced to the place the property has its situs.	2025 Form N-15 instructions, Residency Status (PDF pages 4 and 5), Hawaii source rules (PDF page 12) and Line 17 Rents, Royalties, Partnerships, Estates or Trusts (PDF page 17)	Official text cited
Idaho	Yes	Nonresidents owe Idaho tax on income attributable to the ownership of any interest in real or tangible personal property located in Idaho, and the 2025 instructions report rents and royalties in the Idaho column when received while a resident or related to Idaho business or property.	Idaho Code s. 63-3026A(1) and (3)(a)(ii)	Official text cited
Illinois	Yes	Rents and royalties from real property are allocated to Illinois for nonresidents if the property is located in Illinois, and the tax is imposed on the privilege of earning or receiving income in Illinois or as an Illinois resident.	35 ILCS 5/303(a) and (c)(1)	Official text cited
Indiana	Yes	The 2025 IT-40PNR instructions count a nonresident's royalties as Indiana income only when they result from a trade or business conducted in Indiana while listing income from real or personal property located in Indiana as Indiana income, and residents report all income including income from outside Indiana.	2025 IT-40PNR booklet, Nonresidency and Income Taxable to Indiana (PDF page 8) and Line 12 Net Rent or Royalty Income or Loss (PDF page 14)	Core rule cited
Iowa	Yes	Nonresidents owe Iowa tax on net income from any property, trust, estate, or other source within Iowa, the Department rule says all income of nonresidents derived from sources within Iowa is subject to Iowa income tax, and residents are taxed on their entire taxable income.	Iowa Code 2026 s. 422.8(2)(a)	Official text cited
Kansas	Yes	Nonresidents owe Kansas tax on Kansas source income, which includes income from real or tangible personal property located in Kansas, and residents count all income earned while a Kansas resident.	K.S.A. 79-32,110(a) and (b)	Official text cited
Kentucky	Yes	Nonresidents owe Kentucky tax on income from tangible property located in Kentucky and must report income from property located in Kentucky, while residents are taxed on their entire net income.	KRS 141.020(1), (2)(f) and (4)	Official text cited
Louisiana	Yes	Nonresidents owe Louisiana tax on income earned within or derived from Louisiana sources, which the 2025 IT-540B instructions say includes rents and royalties, and residents are taxed on income from whatever sources derived.	R.S. 47:295(A)	Official text cited
Maine	Yes	Nonresidents owe Maine tax on income derived from or connected with Maine sources, which includes items attributable to the ownership or disposition of any interest in real or tangible personal property in Maine, and residents are taxed on their Maine taxable income.	36 M.R.S. s. 5142(1) and (2)(A)	Official text cited
Maryland	Yes	Nonresidents owe Maryland tax on income derived from real or tangible personal property located in Maryland, whether derived directly or from a fiduciary, because that income is excluded from the nonresident subtraction.	Tax-General s. 10-210(a) and (b)(1)	Official text cited
Massachusetts	Yes	Nonresidents owe Massachusetts tax on gross income derived from or effectively connected with the ownership of any interest in real or tangible personal property located in Massachusetts, and residents are taxed on their taxable income.	G.L. c. 62, s. 5A(a)	Official text cited
Michigan	Yes	Under the Income Tax Act, net rents and royalties from real property located in Michigan are allocable to Michigan, nonresident taxable income is computed subject to these allocation rules, and a resident allocates all taxable income to Michigan except income attributable to another state under sections 111 to 115.	MCL 206.111(1)	Core rule cited
Minnesota	Yes	Nonresidents are taxed on income or gains from tangible property located in Minnesota that is not employed in their business and on rents and royalties from Minnesota sources, while resident income is not subject to allocation outside Minnesota.	Minn. Stat. 290.17, subd. 1(a) and subd. 2(b)	Official text cited
Mississippi	Yes	Mississippi taxes the entire net income of residents, Department of Revenue rules require part-year residents to include income from sources within Mississippi received while a nonresident, and a multistate allocation rule says royalty income from mineral production must be allocated to the state where production occurred.	House Bill 1 (2025 Regular Session), Section 1 amending s. 27-7-5(1)(a), and Section 2	Core rule cited
Missouri	Yes	Nonresidents owe Missouri tax on income derived from Missouri sources, which includes items attributable to the ownership or disposition of any interest in real or tangible personal property in Missouri, and the MO-NRI worksheet lists rents and royalties as a line of Missouri source income.	RSMo 143.181.1 and 143.181.2(1)	Official text cited
Montana	Yes	Nonresidents owe Montana tax on Montana source income, which includes net royalties from real property to the extent the property is used in Montana, and, subject to statutory exceptions, remitters must withhold tax from royalty payments to royalty owners, including owners of nonworking interests in oil or gas production.	MCA 15-30-2101(21)(a)(ix) (2025)	Official text cited
Nebraska	Yes	Nonresidents owe Nebraska tax on income derived from sources within Nebraska, which includes items attributable to the ownership or disposition of any interest in real or tangible personal property in Nebraska, and residents are taxed on their entire income.	Neb. Rev. Stat. 77-2733(1) and (2)(a)	Official text cited
Nevada	No	Nevada does not impose a state income tax on individuals, so an individual's royalty income is not taxed by the state.	Income Tax in Nevada	Official text cited
New Hampshire	No	New Hampshire repealed its interest and dividends tax, which reached only residents' interest and dividend income, for taxable periods beginning after December 31, 2024, and no other New Hampshire tax on individual income was found, so an individual's royalty income is not taxed by the state.	TIR 2025-001, Interest and Dividends Tax Repealed Effective January 1, 2025, and footnote 1 (Laws of 2023, ch. 79, ss. 86 to 88)	Official text cited
New Jersey	Yes	Nonresidents report on Form NJ-1040NR the part of their net income from rents and royalties that is from New Jersey sources, and their tax is based on the percentage of their income that is from New Jersey sources.	2025 Form NJ-1040NR instructions, Income columns A and B (PDF page 6) and Schedule NJ-BUS-1 Part II (PDF pages 16 and 17)	Core rule cited
New Mexico	Yes	All taxpayers allocate to New Mexico income from royalties and working interests in oil and gas producing properties located in New Mexico, nonresidents with royalties from New Mexico sources must file if they also have a federal filing requirement, and remitters must withhold tax from oil and gas proceeds paid to nonresidents, subject to exceptions.	2025 PIT-B instructions, Line 4 Rents and royalties (PDF pages 5 and 6)	Official text cited
New York	Yes	Nonresidents owe New York State tax on rents and royalties from real property located in New York State, whether or not the property is used in a business, and part-year residents also pay tax on all income received while resident.	Instructions for Form IT-203 (2025): How are you taxed as a nonresident or as a part-year resident; Nonresidents: New York source income; Line 11, Rent from real property (PDF pages 3, 12 and 13)	Official text cited
North Carolina	Yes	A nonresident's North Carolina taxable income is the share of income derived from North Carolina sources, including income attributable to the ownership of any interest in real or tangible personal property in North Carolina, while a resident's taxable income starts from full adjusted gross income.	G.S. 105-153.4(a) and (b)	Official text cited
North Dakota	Yes	North Dakota imposes its income tax on every resident and nonresident individual, and remitters must withhold 1.75%, the highest individual rate of 2.50% reduced by 0.75%, from the gross amount of oil or gas royalty payments made to nonresident royalty owners.	N.D.C.C. s. 57-38-30.3(1) and s. 57-38-59.4(1) and (2) (chapter PDF created December 31, 2025)	Official text cited
Ohio	Yes	Ohio allocates a nonresident's nonbusiness rents and royalties from real property to Ohio when the property is physically located in Ohio, allocates all nonbusiness income of residents to Ohio, and its 2025 instructions treat income from letting a company extract minerals from one's land as nonbusiness income when the owner is not in a related trade or business.	R.C. 5747.20(A) and (B)(3)(a), version effective March 23, 2022	Official text cited
Oklahoma	Yes	Nonresidents owe Oklahoma tax on net rents and royalties from real and tangible personal property located in Oklahoma, and remitters must withhold an amount equal to the highest Oklahoma marginal individual income tax rate from the gross oil and gas royalty payments made to royalty owners who are not Oklahoma residents.	68 O.S. s. 2355(D) and (E), s. 2362(F)(1), s. 2385.26(A) and (B)(1)	Official text cited
Oregon	Yes	Nonresidents owe Oregon tax on income from Oregon sources, which the Department of Revenue says includes rents and royalties for use of Oregon property, and full-year residents are taxed on income from all sources, including royalty income reported on federal Schedule E.	ORS 316.037(1)(a) and (3), ORS 316.127(1) and (2)(a)	Official text cited
Pennsylvania	Yes	Nonresidents owe Pennsylvania tax on net income from rents and royalties from property located in Pennsylvania, with royalties from the extraction of minerals allocable to Pennsylvania when the property is located there and the income is not derived from operating a business, residents are taxed on all classes of income regardless of source, and a lessee paying lease payments for Pennsylvania real estate to a nonresident lessor in the course of a trade or business, where lease payments include royalties, must withhold at the 3.07% rate, with withholding optional below $5,000 a year.	PA Personal Income Tax Guide, Net Income (Loss) from Rents, Royalties, Copyrights and Patents: Royalty Income; Allocation of Royalties from Extraction of Minerals; Nonresidents	Official text cited
Rhode Island	Yes	Nonresidents include in Rhode Island income the rents and royalties from real property situated in Rhode Island, whether or not used in a business, and income from real property is fully included if the property is in Rhode Island and fully excluded if it is outside.	2025 Instructions for Filing RI-1040NR: Income of a Nonresident Subject to Tax (PDF page 1) and Line 5, Column A (PDF page 7)	Core rule cited
South Carolina	Yes	Nonresidents are taxed on South Carolina income attributable to the ownership of any interest in real or tangible personal property located in South Carolina, and a person paying a nonresident individual rent or royalties of $1,200 or more a year for the use of property in South Carolina must withhold a percentage equal to the maximum individual tax rate.	S.C. Code s. 12-6-510(B)(1) and s. 12-6-1720(1)(a)	Official text cited
South Dakota	No	South Dakota does not have a personal income tax, so an individual's royalty income is not taxed by the state.	Tax Basics, page 3	Official text cited
Tennessee	No	Tennessee's Hall income tax, which applied only to interest from bonds and notes and dividends from stock, was repealed for tax periods beginning on or after January 1, 2021, so an individual's royalty income is not taxed by the state.	Hall Income Tax page	Official text cited
Texas	No	Texas levies no individual income tax, because Article 8, Section 24-a of the state constitution, added November 5, 2019, bars the legislature from taxing the net incomes of individuals, so an individual's royalty income is not taxed by the state.	Art. 8, Sec. 24-a and its history note (Added Nov. 5, 2019)	Official text cited
Utah	Yes	Utah taxes a nonresident on state taxable income derived from Utah sources, which includes income from the ownership in Utah of any interest in real or tangible personal property, including real property or property rights from which gross income from mining is derived, and residents are taxed on all income received while resident unless specifically exempted.	Utah Code s. 59-10-116(1) and s. 59-10-117(1)(a), version amended by Chapter 252, 2022 General Session (chapter PDF created August 23, 2024)	Core rule cited
Vermont	Yes	The Vermont income of a nonresident includes rents and royalties derived from the ownership of property located in Vermont, while the Vermont income of a resident starts from the resident's full adjusted gross income.	32 V.S.A. s. 5823(a) and (b)(1)	Official text cited
Virginia	Yes	A nonresident is taxed on the share of income from Virginia sources, which include items attributable to the ownership of any interest in real or tangible personal property in Virginia.	Va. Code s. 58.1-302, definition of Income and deductions from Virginia sources, item 1 a	Official text cited
Washington	No	Washington has no individual income tax in 2026 and its capital gains excise applies only to sales or exchanges of long-term capital assets, but from January 1, 2028 a 9.9% tax applies to Washington taxable income, which for residents starts from federal adjusted gross income, excludes long-term capital gains, and allows a $1,000,000 standard deduction.	Income tax page	Official text cited
West Virginia	Yes	Nonresidents report as West Virginia source income any rents and royalties from real property located in West Virginia, whether or not the property is used in a business, and taxable income received from all sources while a resident is taxable.	2025 IT-140 instructions: Who Must File (PDF page 19), Nonresident/Part-Year Resident and West Virginia Source Income (PDF page 20), Rent and Royalty Income (PDF page 33)	Official text cited
Wisconsin	Yes	Income of nonresidents from rentals and royalties from real estate, or from operating any farm, mine or quarry, follows the situs of the property, so royalties from Wisconsin property are taxable to nonresidents, while all income of residents follows the residence of the individual.	Wis. Stat. s. 71.04(1)(a)	Official text cited
Wyoming	No	Wyoming levies no personal state income tax, so an individual's royalty income is not taxed by the state.	Business Resources, tax list	Official text cited

Federal royalty rates

On federal land and the outer continental shelf the United States is the mineral owner and lessor, and the royalty rate is fixed for each lease when it is issued. These rates apply to federal leases, not to private or state minerals. A lease keeps the rate it was issued with, so all three onshore periods are still in force on different leases.

Onshore

Scroll the table sideways to see every column.

Federal onshore oil and gas royalty rate, by lease issue date
Period	Leases covered	Rate	Effective	Source
Before the Inflation Reduction Act	Onshore federal leases issued before August 16, 2022. Each keeps the rate prescribed in the lease or in the regulations at issuance.	Competitive leases: not less than 12.5%, a statutory floor, not a fixed rate. Noncompetitive leases: 12.5% (12 1/2 per centum).	Rate set at issuance; the 12.5% floor is shown in the code history from the 1946 Act through August 16, 2022. Earlier history (1920 to 1946) was not read.	30 U.S.C. 226(b)(1)(A) text and Amendments notes for 2022, 1987 and 1946 (2024 edition, reflects the IRA, predates Pub. L. 119-21)
Inflation Reduction Act	Onshore federal leases issued from August 16, 2022 until the IRA rate was repealed on July 4, 2025. These leases keep 16 2/3%: BLM states its 2026 rule does not amend existing leases with rates above 12.5%.	16 2/3% (BLM regulations wrote it as 16.67%), fixed for leases issued during the 10 year period beginning August 16, 2022, and a 16 2/3% floor after that period. 12 1/2 per centum became 16 2/3 percent wherever it appeared in s. 226, including noncompetitive leases.	August 16, 2022, the date of enactment (Pub. L. 117-169 approved August 16, 2022).	Pub. L. 117-169 s. 50261 and s. 50262(a), 136 Stat. 2056; approved August 16, 2022
Public Law 119-21	Onshore federal leases issued after enactment of Pub. L. 119-21 on July 4, 2025 (BLM wording: leases 'issued after the enactment of the OBBB'). Not retroactive to leases already issued at 16 2/3%.	Competitive leases: not less than 12.5%. Noncompetitive leases, which the Act revived: 12.5%. Reinstated leases: the new lease rate plus 4 points, plus 2 points for each later reinstatement, never below 16.67%.	July 4, 2025, the date of enactment (Pub. L. 119-21 approved July 4, 2025). BLM conformed its regulation effective June 29, 2026 (next entry).	Pub. L. 119-21 s. 50101(a)(1) and (a)(2), 139 Stat. 137; s. 50102(b)(1)(C) and (d), 139 Stat. 141 to 142; approved July 4, 2025
BLM rule, 2026	Production from federal oil and gas leases issued after the enactment of the OBBBA. Existing leases with rates above 12.5% are not amended.	No new rate; conforms the regulation to the Act	June 29, 2026, unless significant adverse comments arrived by May 29, 2026. The eCFR text in force on September 29, 2026 carries the amendment (source note cites 91 FR 23020 and 91 FR 29920), and a Federal Register API search on October 1, 2026 for RIN 1004-AF41 and docket BLM-2025-0138 returned only these two documents, no withdrawal.	DATES; SUPPLEMENTARY INFORMATION; amendment 2 revising 43 CFR 3103.31(a), 91 FR 23018 to 23020

Offshore

Outer Continental Shelf Lands Act s. 8(a)(1), 43 U.S.C. 1337(a)(1); BOEM sets the rate for each sale in its final notice of sale.

Outer continental shelf oil and gas royalty rate, by lease issue date
Period	Leases covered	Rate	Effective	Source
Before the Inflation Reduction Act	OCS leases issued from sales before August 16, 2022. Each lease carries the rate fixed in its sale notice.	Statutory floor of not less than 12 1/2 per centum; the rate of each sale was set by BOEM above that floor or at it. Rates of individual pre 2022 sales were not read.		43 U.S.C. 1337(a)(1)(A) to (H) and the 2022 Amendments note (2024 edition, predates Pub. L. 119-21)
Inflation Reduction Act	OCS leases issued during the 10 year period beginning August 16, 2022, until repeal on July 4, 2025 (repeal is not stated to reach leases already issued).	Not less than 16 2/3% and not more than 18 3/4% during the 10 year period, not less than 16 2/3% after it. Lease Sale 261 (Gulf of Mexico, held September 27, 2023) set 18 3/4% for all leases.	2022-08-16	Pub. L. 117-169 s. 50261 and s. 50262(a), 136 Stat. 2056; approved August 16, 2022
Public Law 119-21	OCS leases issued after July 4, 2025, including the sales the Act mandates in the Gulf of America and Cook Inlet.	Not less than 12 1/2% and not more than 16 2/3% (43 U.S.C. 1337(a)(1) as amended). For the mandated Gulf of America sales the Secretary must set the rate at not less than 12 1/2% and not greater than 16 2/3%. BOEM final notices of sale set 12 1/2% for blocks in all water depths in BBG1 (sale date December 10, 2025), BBG2 (March 11, 2026) and BBG3 (August 12, 2026), and 12.5% in Cook Inlet BBC1 (March 4, 2026).	2025-07-04	Pub. L. 119-21 s. 50101(a)(1) and (a)(2), 139 Stat. 137; s. 50102(b)(1)(C) and (d), 139 Stat. 141 to 142; approved July 4, 2025

The offshore rate is in 43 U.S.C. 1337(a)(1) (Outer Continental Shelf Lands Act s. 8), not 30 U.S.C. 1337. uscode.house.gov was under maintenance on October 1, 2026, so the codified text is the govinfo 2024 edition (current through the IRA) read together with the amending text of Pub. L. 119-21.

Method and limits

Each row was checked against the cited source on October 6, 2026. Where a state’s official site was not available, a dated archive copy of the official page was read. Income tax rows say whether a broad personal income tax exists and how it reaches royalty income; they do not list rates, brackets, credits or local taxes. Nothing here is tax advice. Methodology.

Common questions about taxes on mineral royalties

Is mineral royalty income taxable?

Yes, at the federal level, and in most states. The IRS has individuals report royalties from oil, gas and mineral properties on line 4 of Schedule E, and a payer that pays you $10 or more in a year should send a Form 1099-MISC (Instructions for Schedule E, 2025). 42 of the 51 jurisdictions tax it through a broad personal income tax.

Which states do not tax royalty income?

9 states have no broad personal income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. The table above gives the reading and source for each.

Do I owe tax in the state where the minerals are if I live elsewhere?

Usually, if that state taxes personal income. Each of the 41 states with a broad personal income tax taxes nonresidents on income from sources in the state, and its forms treat royalties from in-state minerals that way. D.C. is the exception: the Home Rule Act bars it from taxing nonresidents’ personal income. Many states give their own residents a credit for tax paid to another state, so check your home state’s rule as well.

What is severance tax, and who pays it?

It is a tax a producing state levies on oil and gas as it is taken from the ground, usually a percentage of value or a rate per barrel or per thousand cubic feet. In most of the 25 producing states on this page, the operator or purchaser withholds each royalty owner’s share of the tax from the payment; each state card gives the rule with its citation.

Cite this page

American Mineral Registry. "Oil and Gas Severance Tax by State." Release 2026.10.1, October 6, 2026. https://americanmineralregistry.com/research/oil-and-gas-severance-tax-by-state

[Oil and Gas Severance Tax by State](https://americanmineralregistry.com/research/oil-and-gas-severance-tax-by-state), American Mineral Registry, release 2026.10.1 (October 6, 2026).

<a href="https://americanmineralregistry.com/research/oil-and-gas-severance-tax-by-state">Oil and Gas Severance Tax by State</a>, American Mineral Registry, release 2026.10.1 (October 6, 2026).

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