Tax on income from investment

I am interested in investing $100k on rights to a oil well. The lifespan of the well is 5-10 years. I should recover my investment in approximatly 3 years, then profit for the remaining life of the well.
I have a full time job and I am in the 28% Tax Bracket.
Am I required to pay tax on my yearly income from the well before I recover my investment? How much am I required to pay after I recover my investment?
If they drill and find no oil am I entitled to claim the $100k as a business loss? If so how much can I expect to recover when i file my taxes?

Thanks,

Chris

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Submitted 1 day ago...

broker

Beginner (11)

Generally only accredited investors and high tax bracket individuals invest in oil wells, those worth over 1.5 million and make over 250k per year. for the tax right off, generally 80-90 percent is deductable against current taxes. Any income received or return of principal is taxed as ordinary income.
very speculative and risky investment.

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