Company: MTR
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001104659-25-029944
Chunk: 10

Company: MESA ROYALTY TRUST/TX
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1
Chunk 10
---
 elects under provisions of the Code to treat Royalty income as effectively connected with the conduct of a U. S. trade or business, the corporation may also be subject to the U. S. branch profits tax at a rate of 30%. This tax is imposed on U. S. branch profits of a foreign corporation that are not reinvested in the U. S. trade or business and is in addition to the tax on effectively connected income. The branch profits tax may be either reduced or eliminated by treaty. Federal income taxation of a non-U. S. unitholder is a highly complex matter which may be affected by many considerations. Therefore, each non-U. S. unitholder is encouraged to consult with his own tax advisor with respect to its ownership of Trust units.

Pursuant to the Foreign Account Tax Compliance Act (commonly referred to as “ FATCA”), distributions from the Trust to “foreign financial institutions” and certain other “non-financial foreign entities” may be subject to U. S. withholding taxes. Specifically, certain “withholdable payments” (including certain royalties, interest and other income from U. S. sources) made to a foreign financial institution or non-financial foreign entity will generally be subject to the withholding tax unless the foreign financial institution or non-financial foreign entity complies with certain information reporting, withholding, identification, certification and related requirements imposed by FATCA. Foreign financial institutions located in jurisdictions that have an intergovernmental agreement with the U. S. governing FATCA may be subject to different rules. Foreign unitholders are encouraged to consult their own tax advisors regarding the possible implications of these withholding provisions on their investment in Trust units.

Tax-exempt Organizations

The Royalty and interest income should not be “unrelated business taxable income” (as defined in Code § 512(b)), so long as, generally, a unitholder did not incur debt to acquire a unit or otherwise incur or maintain a debt that would not have been incurred or maintained if the unit had not been acquired. Legislative proposals have been made from time to time which, if adopted, would result in the treatment of Royalty income as unrelated business taxable income. Each tax-exempt unitholder is encouraged to consult its own advisor with respect to the treatment of Royalty income.

6

TABLE OF CONTENTS

DESCRIPTION OF ROYALTY PROPERTIES

Producing Acreage and Wells as of December 31, 2024

Detailed information concerning the number of wells and producing acres on