A royalty trust is a type of corporation, mostly in the United States or Canada, usually involved in oil and gas production or mining. However, unlike most corporations, its profits are not taxed at the corporate level provided a certain high percentage (e.g. 90%) of profits are distributed to shareholders as dividends. The dividends are then taxed as personal income. This system, similar to real estate investment trusts, effectively avoids the double taxation of corporate income.
Texas oilman T. Boone Pickens is often credited with creating the first royalty trust in 1979; however Marine Petroleum Trust (Marps) was created in 1956, twenty three years earlier.[citation needed]