depletion allowance, in corporate income tax, the deductions from gross income allowed investors in exhaustible mineral deposits (including oil or gas) for the depletion of the deposits. The theory behind the allowance is that an incentive is necessary to stimulate investment in this high-risk industry.
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The oil depletion allowance in American (US) tax law is an allowance claimable by anyone with an economic interest in a mineral deposit or standing timber.
Oil depletion allowance
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The oil depletion allowance in American tax law is an allowance claimable by anyone with an economic interest in a mineral deposit or standing timber. The principle is that the asset is a capital investment that is a wasting asset, and therefore... Wikipedia
May 18, 2023 · This allowance is a significant subsidy for corporations. The oil depletion allowance provides a tax-advantaged investment opportunity for ...
Jun 30, 2022 · To oversimplify considerably, the oil depletion allowance permits an oil producer or royalty owner to deduct from his taxable income a ...
Dec 3, 2012 · The IRS defines depletion as "the using up of natural resources by mining, quarrying, drilling, or felling." Recognizing that oil, gas, and ...
May 4, 2023 · Oil depletion allowance is a tax deduction that allows businesses and investors that extract natural resources connected with oil to recover ...
For oil and gas royalty owners, percentage depletion is calculated using a rate of 15% of the gross income based on your average daily production of crude oil ...
Such allowance shall not exceed 50 percent (100 percent in the case of oil and gas properties) of the taxpayer's taxable income from the property (computed ...
Mar 5, 2023 · In other words, the depletion allowance is an oil and gas deduction from gross income that is allowed, reflecting the depletion of mineral ...
Section 611 provides that there shall be allowed as a deduction in computing taxable income in the case of mines, oil and gas wells, other natural deposits, and ...