IL HB4920

Amends the Principal and Income Act to modify how oil and gas receipts from non-coal formations are allocated between income and principal in nontrust estates and for legal tenants and remaindermen.

Creates a new provision (Section 10(4)) designating proceeds from the sale of oil or gas minerals from non-coal formations as income when received as royalty, overriding royalty, limited royalty, working interest, net profit interest, time-limited interest, term interest, or lease bonus.

Modifies Section 10(3) to exclude oil and gas from non-coal formations held in nontrust estates and by legal tenants and remaindermen from the depletion allowance calculation previously applied to other natural resource receipts.

Removes former Section 15(d) which had previously excluded life estates and remainder interests in oil or gas from non-coal formations from the Act's application.

Applies these changes only to oil and gas interests specifically described in Section 15, affecting nontrust estates and legal tenancy arrangements involving non-coal formation minerals.