Called IRS and talked to different people have been told different things. I want to make sure that we send the taxes to the right states. We live in Ohio and have property in pa that has recently been leased for gas drilling. We just received lump some payment for 5 year lease a couple weeks ago. Was told by IRS that their taxes are due tax day. We asked if we can send the taxes at the end of the year and avoid any penalties and they weren't for sure or not. Asked about the state taxes on the money and they gave us the phone numbers for Ohio and pa.We called Ohio first and they told us that they we not sure if we had to pay any Ohio tax on it because the property is in pa and that's where it was turned in to the state there. To make sure they told us to call there and check.We did and got a mean person on the other end and were told that yes it would be taxed in pa and all taxes are due by April tax day and that's it. They didn't tell us what forms to fill out or how to get them since we are nonresidents of that state. I think that we only have to fill out an estimated tax form for pa and federal for this year only.

I assume you filed estimated taxes for Pennsylvania and the IRS.

Clearly, the lease payment is taxable income on your federal return, probably claimed on Line #21 of Form 1040.

Since the property is in Pennsylvania, PA taxes are due.

Ohio taxes are due on the lease payment as well. However, you can and should have claimed a credit on your Ohio tax for the PA taxes paid.