The following terms pertain to this chapter:

(1) "Advanced mineral payments" are payments made to royalty interest owners that represent the royalty interest owner's future share of the receipts from the sale of the natural resource.

(2) "Employer's agent" with regard to state withholding means a third party that bears no insurance risk and is reimbursed on a cost-plus-fee basis for payment of sick pay and similar amounts.

(3) "First purchaser" means the first person to pay for production after it is extracted from deposits in this state. Generally the first purchaser is an arms-length entity that pays a market price.

(4) "Individual" means a worker who renders service in the course of an occupation.

(5) "Mineral payments" are payments made to royalty interest owners that represent the royalty interest owner's future share of the receipts from the sale of the natural resource.

(6) "Net royalty amount payable" means the amount of mineral proceeds subject to withholding. This amount is equal to the gross royalty payments less any taxes and other expenses deducted pursuant to the royalty agreement in effect.

(7) "Overriding royalty interest" means ownership in a percentage of production or production revenues, free of the cost of production, created by the lessee, company and/or working interest owner and paid by the lessee, company and/or working interest owner out of revenue from the well.

(8) "Person" means any natural person, company, corporation, association,

partnership, joint venture, cooperative, estate, trust, receiver, or any other party or entity that has a working interest, royalty interest, overriding royalty interest, production payment, production payment including in-kind exchanges, or any other ownership interest entitled to production proceeds from deposits in this state.

(9) "Producer" is the person that extracts natural resources from deposits in the state.

(10) "Remittor" means the individual, entity, or trust obligated under a mineral lease to pay royalties to the royalty owner or his assignee, to deliver minerals to a purchaser to the credit of such royalty owner or his assignee, or to pay a portion of the proceeds of the sale of such minerals to the royalty owner or his assignee.

(11) "Reporting forms" includes, but is not limited to:

(a) M1 - payment coupon;

(b) MW3 - State Income Tax Withholding Reconciliation and Transmittal Document (W-2); and

(c) W-2 - Wage and Tax Statement.

(12) "Sole proprietor," as used in 15-30-256, MCA, includes the individual owner of a single-member limited liability company that is disregarded for income tax purposes and may include a husband and wife partnership for the purpose of withholding.

(13) "Take in kind" means someone other than the well operator takes their share of the production and does not sell it with the party(s) contracted with the operator. The operator might want to sell gas to one purchaser, but another company wants to sell or use their portion of the gas for another purpose. Thus, they "take in kind".