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2012 Ez Tax Form

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Social Media Registry API Documentation

About the API

This documentation describes methods to use the Social Media Registry API to access the contents of the Social Media Registry.

The Social Media Registry is an official source of information about social media accounts that represent official U.S. federal government agencies, elected officials, or members of the President’s Cabinet.

If you work for the federal government and have a .gov or .mil e-mail address, you can register official U.S. federal accounts at HowTo.gov.

If you have feedback, questions, or want to tell us about the product you built with the Social Media Registry API, please e-mail us.

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Accessing the API

The interface described here uses the same method URLs and parameters for all response formats, including HTML5, JSON, and XML. If no response format is specified at request time, the results are returned as HTML5 (with the assumption that a user is accessing the API via a web browser). To specify alternate formats, append the result format to the method call:

http://registry.usa.gov/accounts?agency_id=usda
http://registry.usa.gov/accounts.json?agency_id=usda
http://registry.usa.gov/accounts.xml?agency_id=usda

API requests can be called from remote sites via Javascript using the Cross-Origin Resource Sharing mechanism (CORS) supported in most browsers. All published API methods may be called from any domain.

If support for older browsers is required, JSON requests can be made with a callback parameter in order to return JSONP responses:

http://registry.usa.gov/accounts.json?agency_id=usda&callback=listaccounts

API Updates Using Feeds

Some API methods are also available as feeds in the ATOM format. These feeds can be added to any news feed reader to list recent changes.

The ATOM format is an XML feed standard; each entry contains a summary of the Registry change and a link to the Registry API to view more information.

Feed Examples

List the most recently updated official Twitter accounts: http://registry.usa.gov/accounts.atom?service_id=twitter

List the most recently updated official accounts from the U.S. Department of Agriculture: http://registry.usa.gov/accounts.atom?agency_id=usda

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API Methods

/accounts (GET)

List official U.S. government social media accounts entries in the registry. This method is also available as an ATOM feed.

Parameters

  • agency_id: ID (from /agencies)
  • service_id: ID (from /services)
  • tag: text
  • page_size: integer
  • page_number: integer

Output

  • page_count: integer
  • page_number: integer
  • total_items: integer

Accounts

  • service_url: text
  • verified : boolean
  • service_id: ID
  • account: text
  • details_url: text
  • organization: text
  • agencies
    • agency_id: text
    • agency_name: text
    • agency_url: text

Example Calls

List all official accounts from the U.S. Department of Agriculture: http://registry.usa.gov/accounts?agency_id=usda

List all official Twitter accounts from the U.S. Department of Health and Human Services:
http://registry.usa.gov/accounts?service=twitter&agency_id=hhs

/accounts/{service ID} (GET)

A synonym for /accounts?service_id={service}, provided for REST-style browsing.

/accounts/{service ID}/{account} (GET)

A synonym for the /accounts/verify method, using a canonical service and account ID provided by that method. For example, the service and account ID for http://twitter.com/JPL_Bear might be twitter/JPL_Bear, making the canonical URL take the form http://registry.usa.gov/accounts/twitter/JPL_Bear

This is provided primarily for REST-style browsing.

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/accounts/verify (GET)

Check whether the provided URL is registered as an official government social media account.

Example: /accounts/verify?service_url=https%3A%2F%2Ftwitter.com%2F%23%21%2FJPL_Bear

Parameters

  • service_url: URL (required)

Output

  • verified: boolean
  • service_url: URL
  • service_id: ID (from /services list)
  • account: text

(if verified is true:)

  • details_url: URL
  • organization: text
  • info_url: text
  • agencies
    • agency_id: text
    • agency_name: text
    • agency_url: text
  • tags: list
  • language: text
  • display_name: text
  • updated_by: text
  • updated_at: ISO 8601 date

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/agencies (GET) 

List the sponsoring agencies that may be specified in the /accounts/add method.

Parameters

  • none

Output

  • page_count: integer
  • total_items: integer
  • page_number: integer
  • agencies: list
    • agency_id: text
    • agency_name: text
    • agency_url: text

/services (GET)

List the social media services that are currently supported in the /accounts/add method.

Parameters

  • none

Output

  • page_count: integer
  • total_items: integer
  • page_number: integer
  • services: list
    • service_id: text
    • service_name: text

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/tags (GET) 

List tags that are suggested for describing an account.

Parameters

  • keywords: text

Output

  • tags: list
  • tag_id: text
  • tag_text: text

Source Code

The code for the Social Media Registry is open source and available on GitHub. It is written in Ruby.

Example Applications

Terms of Service

By using this data, you agree to the Terms of Service.

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The 2012 Ez Tax Form

2012 ez tax form 9. 2012 ez tax form   Depletion Table of Contents Introduction Topics - This chapter discusses: Who Can Claim Depletion? Mineral PropertyCost Depletion Percentage Depletion Oil and Gas Wells Mines and Geothermal Deposits Lessor's Gross Income TimberTimber units. 2012 ez tax form Depletion unit. 2012 ez tax form Introduction Depletion is the using up of natural resources by mining, drilling, quarrying stone, or cutting timber. 2012 ez tax form The depletion deduction allows an owner or operator to account for the reduction of a product's reserves. 2012 ez tax form There are two ways of figuring depletion: cost depletion and percentage depletion. 2012 ez tax form For mineral property, you generally must use the method that gives you the larger deduction. 2012 ez tax form For standing timber, you must use cost depletion. 2012 ez tax form Topics - This chapter discusses: Who can claim depletion Mineral property Timber Who Can Claim Depletion? If you have an economic interest in mineral property or standing timber, you can take a deduction for depletion. 2012 ez tax form More than one person can have an economic interest in the same mineral deposit or timber. 2012 ez tax form In the case of leased property, the depletion deduction is divided between the lessor and the lessee. 2012 ez tax form You have an economic interest if both the following apply. 2012 ez tax form You have acquired by investment any interest in mineral deposits or standing timber. 2012 ez tax form You have a legal right to income from the extraction of the mineral or cutting of the timber to which you must look for a return of your capital investment. 2012 ez tax form A contractual relationship that allows you an economic or monetary advantage from products of the mineral deposit or standing timber is not, in itself, an economic interest. 2012 ez tax form A production payment carved out of, or retained on the sale of, mineral property is not an economic interest. 2012 ez tax form Individuals, corporations, estates, and trusts who claim depletion deductions may be liable for alternative minimum tax. 2012 ez tax form Basis adjustment for depletion. 2012 ez tax form   You must reduce the basis of your property by the depletion allowed or allowable, whichever is greater. 2012 ez tax form Mineral Property Mineral property includes oil and gas wells, mines, and other natural deposits (including geothermal deposits). 2012 ez tax form For this purpose, the term “property” means each separate interest you own in each mineral deposit in each separate tract or parcel of land. 2012 ez tax form You can treat two or more separate interests as one property or as separate properties. 2012 ez tax form See section 614 of the Internal Revenue Code and the related regulations for rules on how to treat separate mineral interests. 2012 ez tax form There are two ways of figuring depletion on mineral property. 2012 ez tax form Cost depletion. 2012 ez tax form Percentage depletion. 2012 ez tax form Generally, you must use the method that gives you the larger deduction. 2012 ez tax form However, unless you are an independent producer or royalty owner, you generally cannot use percentage depletion for oil and gas wells. 2012 ez tax form See Oil and Gas Wells , later. 2012 ez tax form Cost Depletion To figure cost depletion you must first determine the following. 2012 ez tax form The property's basis for depletion. 2012 ez tax form The total recoverable units of mineral in the property's natural deposit. 2012 ez tax form The number of units of mineral sold during the tax year. 2012 ez tax form Basis for depletion. 2012 ez tax form   To figure the property's basis for depletion, subtract all the following from the property's adjusted basis. 2012 ez tax form Amounts recoverable through: Depreciation deductions, Deferred expenses (including deferred exploration and development costs), and Deductions other than depletion. 2012 ez tax form The residual value of land and improvements at the end of operations. 2012 ez tax form The cost or value of land acquired for purposes other than mineral production. 2012 ez tax form Adjusted basis. 2012 ez tax form   The adjusted basis of your property is your original cost or other basis, plus certain additions and improvements, and minus certain deductions such as depletion allowed or allowable and casualty losses. 2012 ez tax form Your adjusted basis can never be less than zero. 2012 ez tax form See Publication 551, Basis of Assets, for more information on adjusted basis. 2012 ez tax form Total recoverable units. 2012 ez tax form   The total recoverable units is the sum of the following. 2012 ez tax form The number of units of mineral remaining at the end of the year (including units recovered but not sold). 2012 ez tax form The number of units of mineral sold during the tax year (determined under your method of accounting, as explained next). 2012 ez tax form   You must estimate or determine recoverable units (tons, pounds, ounces, barrels, thousands of cubic feet, or other measure) of mineral products using the current industry method and the most accurate and reliable information you can obtain. 2012 ez tax form You must include ores and minerals that are developed, in sight, blocked out, or assured. 2012 ez tax form You must also include probable or prospective ores or minerals that are believed to exist based on good evidence. 2012 ez tax form But see Elective safe harbor for owners of oil and gas property , later. 2012 ez tax form Number of units sold. 2012 ez tax form   You determine the number of units sold during the tax year based on your method of accounting. 2012 ez tax form Use the following table to make this determination. 2012 ez tax form    IF you  use . 2012 ez tax form . 2012 ez tax form . 2012 ez tax form THEN the units sold during the year are . 2012 ez tax form . 2012 ez tax form . 2012 ez tax form The cash method of accounting The units sold for which you receive payment during the tax year (regardless of the year of sale). 2012 ez tax form An accrual method of accounting The units sold based on your inventories and method of accounting for inventory. 2012 ez tax form   The number of units sold during the tax year does not include any for which depletion deductions were allowed or allowable in earlier years. 2012 ez tax form Figuring the cost depletion deduction. 2012 ez tax form   Once you have figured your property's basis for depletion, the total recoverable units, and the number of units sold during the tax year, you can figure your cost depletion deduction by taking the following steps. 2012 ez tax form Step Action Result 1 Divide your property's basis for depletion by total recoverable units. 2012 ez tax form Rate per unit. 2012 ez tax form 2 Multiply the rate per unit by units sold during the tax year. 2012 ez tax form Cost depletion deduction. 2012 ez tax form You must keep accounts for the depletion of each property and adjust these accounts each year for units sold and depletion claimed. 2012 ez tax form Elective safe harbor for owners of oil and gas property. 2012 ez tax form   Instead of using the method described earlier to determine the total recoverable units, you can use an elective safe harbor. 2012 ez tax form If you choose the elective safe harbor, the total recoverable units equal 105% of a property's proven reserves (both developed and undeveloped). 2012 ez tax form For details, see Revenue Procedure 2004-19 on page 563 of Internal Revenue Bulletin 2004-10, available at www. 2012 ez tax form irs. 2012 ez tax form gov/pub/irs-irbs/irb04-10. 2012 ez tax form pdf. 2012 ez tax form   To make the election, attach a statement to your timely filed (including extensions) original return for the first tax year for which the safe harbor is elected. 2012 ez tax form The statement must indicate that you are electing the safe harbor provided by Revenue Procedure 2004-19. 2012 ez tax form The election, if made, is effective for the tax year in which it is made and all later years. 2012 ez tax form It cannot be revoked for the tax year in which it is elected, but may be revoked in a later year. 2012 ez tax form Once revoked, it cannot be re-elected for the next 5 years. 2012 ez tax form Percentage Depletion To figure percentage depletion, you multiply a certain percentage, specified for each mineral, by your gross income from the property during the tax year. 2012 ez tax form The rates to be used and other rules for oil and gas wells are discussed later under Independent Producers and Royalty Owners and under Natural Gas Wells . 2012 ez tax form Rates and other rules for percentage depletion of other specific minerals are found later in Mines and Geothermal Deposits . 2012 ez tax form Gross income. 2012 ez tax form   When figuring percentage depletion, subtract from your gross income from the property the following amounts. 2012 ez tax form Any rents or royalties you paid or incurred for the property. 2012 ez tax form The part of any bonus you paid for a lease on the property allocable to the product sold (or that otherwise gives rise to gross income) for the tax year. 2012 ez tax form A bonus payment includes amounts you paid as a lessee to satisfy a production payment retained by the lessor. 2012 ez tax form   Use the following fraction to figure the part of the bonus you must subtract. 2012 ez tax form No. 2012 ez tax form of units sold in the tax year Recoverable units from the property × Bonus Payments For oil and gas wells and geothermal deposits, more information about the definition of gross income from the property is under Oil and Gas Wells , later. 2012 ez tax form For other property, more information about the definition of gross income from the property is under Mines and Geothermal Deposits , later. 2012 ez tax form Taxable income limit. 2012 ez tax form   The percentage depletion deduction generally cannot be more than 50% (100% for oil and gas property) of your taxable income from the property figured without the depletion deduction and the domestic production activities deduction. 2012 ez tax form   Taxable income from the property means gross income from the property minus all allowable deductions (except any deduction for depletion or domestic production activities) attributable to mining processes, including mining transportation. 2012 ez tax form These deductible items include, but are not limited to, the following. 2012 ez tax form Operating expenses. 2012 ez tax form Certain selling expenses. 2012 ez tax form Administrative and financial overhead. 2012 ez tax form Depreciation. 2012 ez tax form Intangible drilling and development costs. 2012 ez tax form Exploration and development expenditures. 2012 ez tax form Deductible taxes (see chapter 5), but not taxes that you capitalize or take as a credit. 2012 ez tax form Losses sustained. 2012 ez tax form   The following rules apply when figuring your taxable income from the property for purposes of the taxable income limit. 2012 ez tax form Do not deduct any net operating loss deduction from the gross income from the property. 2012 ez tax form Corporations do not deduct charitable contributions from the gross income from the property. 2012 ez tax form If, during the year, you dispose of an item of section 1245 property that was used in connection with mineral property, reduce any allowable deduction for mining expenses by the part of any gain you must report as ordinary income that is allocable to the mineral property. 2012 ez tax form See section 1. 2012 ez tax form 613-5(b)(1) of the regulations for information on how to figure the ordinary gain allocable to the property. 2012 ez tax form Oil and Gas Wells You cannot claim percentage depletion for an oil or gas well unless at least one of the following applies. 2012 ez tax form You are either an independent producer or a royalty owner. 2012 ez tax form The well produces natural gas that is either sold under a fixed contract or produced from geopressured brine. 2012 ez tax form If you are an independent producer or royalty owner, see Independent Producers and Royalty Owners , next. 2012 ez tax form For information on the depletion deduction for wells that produce natural gas that is either sold under a fixed contract or produced from geopressured brine, see Natural Gas Wells , later. 2012 ez tax form Independent Producers and Royalty Owners If you are an independent producer or royalty owner, you figure percentage depletion using a rate of 15% of the gross income from the property based on your average daily production of domestic crude oil or domestic natural gas up to your depletable oil or natural gas quantity. 2012 ez tax form However, certain refiners, as explained next, and certain retailers and transferees of proven oil and gas properties, as explained next, cannot claim percentage depletion. 2012 ez tax form For information on figuring the deduction, see Figuring percentage depletion , later. 2012 ez tax form Refiners who cannot claim percentage depletion. 2012 ez tax form   You cannot claim percentage depletion if you or a related person refine crude oil and you and the related person refined more than 75,000 barrels on any day during the tax year based on average (rather than actual) daily refinery runs for the tax year. 2012 ez tax form The average daily refinery run is computed by dividing total refinery runs for the tax year by the total number of days in the tax year. 2012 ez tax form Related person. 2012 ez tax form   You and another person are related persons if either of you holds a significant ownership interest in the other person or if a third person holds a significant ownership interest in both of you. 2012 ez tax form For example, a corporation, partnership, estate, or trust and anyone who holds a significant ownership interest in it are related persons. 2012 ez tax form A partnership and a trust are related persons if one person holds a significant ownership interest in each of them. 2012 ez tax form For purposes of the related person rules, significant ownership interest means direct or indirect ownership of 5% or more in any one of the following. 2012 ez tax form The value of the outstanding stock of a corporation. 2012 ez tax form The interest in the profits or capital of a partnership. 2012 ez tax form The beneficial interests in an estate or trust. 2012 ez tax form Any interest owned by or for a corporation, partnership, trust, or estate is considered to be owned directly both by itself and proportionately by its shareholders, partners, or beneficiaries. 2012 ez tax form Retailers who cannot claim percentage depletion. 2012 ez tax form   You cannot claim percentage depletion if both the following apply. 2012 ez tax form You sell oil or natural gas or their by-products directly or through a related person in any of the following situations. 2012 ez tax form Through a retail outlet operated by you or a related person. 2012 ez tax form To any person who is required under an agreement with you or a related person to use a trademark, trade name, or service mark or name owned by you or a related person in marketing or distributing oil, natural gas, or their by-products. 2012 ez tax form To any person given authority under an agreement with you or a related person to occupy any retail outlet owned, leased, or controlled by you or a related person. 2012 ez tax form The combined gross receipts from sales (not counting resales) of oil, natural gas, or their by-products by all retail outlets taken into account in (1) are more than $5 million for the tax year. 2012 ez tax form   For the purpose of determining if this rule applies, do not count the following. 2012 ez tax form Bulk sales (sales in very large quantities) of oil or natural gas to commercial or industrial users. 2012 ez tax form Bulk sales of aviation fuels to the Department of Defense. 2012 ez tax form Sales of oil or natural gas or their by-products outside the United States if none of your domestic production or that of a related person is exported during the tax year or the prior tax year. 2012 ez tax form Related person. 2012 ez tax form   To determine if you and another person are related persons, see Related person under Refiners who cannot claim percentage depletion, earlier. 2012 ez tax form Sales through a related person. 2012 ez tax form   You are considered to be selling through a related person if any sale by the related person produces gross income from which you may benefit because of your direct or indirect ownership interest in the person. 2012 ez tax form   You are not considered to be selling through a related person who is a retailer if all the following apply. 2012 ez tax form You do not have a significant ownership interest in the retailer. 2012 ez tax form You sell your production to persons who are not related to either you or the retailer. 2012 ez tax form The retailer does not buy oil or natural gas from your customers or persons related to your customers. 2012 ez tax form There are no arrangements for the retailer to acquire oil or natural gas you produced for resale or made available for purchase by the retailer. 2012 ez tax form Neither you nor the retailer knows of or controls the final disposition of the oil or natural gas you sold or the original source of the petroleum products the retailer acquired for resale. 2012 ez tax form Transferees who cannot claim percentage depletion. 2012 ez tax form   You cannot claim percentage depletion if you received your interest in a proven oil or gas property by transfer after 1974 and before October 12, 1990. 2012 ez tax form For a definition of the term “transfer,” see section 1. 2012 ez tax form 613A-7(n) of the regulations. 2012 ez tax form For a definition of the term “interest in proven oil or gas property,” see section 1. 2012 ez tax form 613A-7(p) of the regulations. 2012 ez tax form Figuring percentage depletion. 2012 ez tax form   Generally, as an independent producer or royalty owner, you figure your percentage depletion by computing your average daily production of domestic oil or gas and comparing it to your depletable oil or gas quantity. 2012 ez tax form If your average daily production does not exceed your depletable oil or gas quantity, you figure your percentage depletion by multiplying the gross income from the oil or gas property (defined later) by 15%. 2012 ez tax form If your average daily production of domestic oil or gas exceeds your depletable oil or gas quantity, you must make an allocation as explained later under Average daily production. 2012 ez tax form   In addition, there is a limit on the percentage depletion deduction. 2012 ez tax form See Taxable income limit , later. 2012 ez tax form Average daily production. 2012 ez tax form   Figure your average daily production by dividing your total domestic production of oil or gas for the tax year by the number of days in your tax year. 2012 ez tax form Partial interest. 2012 ez tax form   If you have a partial interest in the production from a property, figure your share of the production by multiplying total production from the property by your percentage of interest in the revenues from the property. 2012 ez tax form   You have a partial interest in the production from a property if you have a net profits interest in the property. 2012 ez tax form To figure the share of production for your net profits interest, you must first determine your percentage participation (as measured by the net profits) in the gross revenue from the property. 2012 ez tax form To figure this percentage, you divide the income you receive for your net profits interest by the gross revenue from the property. 2012 ez tax form Then multiply the total production from the property by your percentage participation to figure your share of the production. 2012 ez tax form Example. 2012 ez tax form Javier Robles owns oil property in which Pablo Olmos owns a 20% net profits interest. 2012 ez tax form During the year, the property produced 10,000 barrels of oil, which Javier sold for $200,000. 2012 ez tax form Javier had expenses of $90,000 attributable to the property. 2012 ez tax form The property generated a net profit of $110,000 ($200,000 − $90,000). 2012 ez tax form Pablo received income of $22,000 ($110,000 × . 2012 ez tax form 20) for his net profits interest. 2012 ez tax form Pablo determined his percentage participation to be 11% by dividing $22,000 (the income he received) by $200,000 (the gross revenue from the property). 2012 ez tax form Pablo determined his share of the oil production to be 1,100 barrels (10,000 barrels × 11%). 2012 ez tax form Depletable oil or natural gas quantity. 2012 ez tax form   Generally, your depletable oil quantity is 1,000 barrels. 2012 ez tax form Your depletable natural gas quantity is 6,000 cubic feet multiplied by the number of barrels of your depletable oil quantity that you choose to apply. 2012 ez tax form If you claim depletion on both oil and natural gas, you must reduce your depletable oil quantity (1,000 barrels) by the number of barrels you use to figure your depletable natural gas quantity. 2012 ez tax form Example. 2012 ez tax form You have both oil and natural gas production. 2012 ez tax form To figure your depletable natural gas quantity, you choose to apply 360 barrels of your 1000-barrel depletable oil quantity. 2012 ez tax form Your depletable natural gas quantity is 2. 2012 ez tax form 16 million cubic feet of gas (360 × 6000). 2012 ez tax form You must reduce your depletable oil quantity to 640 barrels (1000 − 360). 2012 ez tax form If you have production from marginal wells, see section 613A(c)(6) of the Internal Revenue Code to figure your depletable oil or natural gas quantity. 2012 ez tax form Also, see Notice 2012-50, available at www. 2012 ez tax form irs. 2012 ez tax form gov/irb/2012–31_IRB/index. 2012 ez tax form html. 2012 ez tax form Business entities and family members. 2012 ez tax form   You must allocate the depletable oil or gas quantity among the following related persons in proportion to each entity's or family member's production of domestic oil or gas for the year. 2012 ez tax form Corporations, trusts, and estates if 50% or more of the beneficial interest is owned by the same or related persons (considering only persons that own at least 5% of the beneficial interest). 2012 ez tax form You and your spouse and minor children. 2012 ez tax form A related person is anyone mentioned in the related persons discussion under Nondeductible loss in chapter 2 of Publication 544, except that for purposes of this allocation, item (1) in that discussion includes only an individual, his or her spouse, and minor children. 2012 ez tax form Controlled group of corporations. 2012 ez tax form   Members of the same controlled group of corporations are treated as one taxpayer when figuring the depletable oil or natural gas quantity. 2012 ez tax form They share the depletable quantity. 2012 ez tax form A controlled group of corporations is defined in section 1563(a) of the Internal Revenue Code, except that, for this purpose, the stock ownership requirement in that definition is “more than 50%” rather than “at least 80%. 2012 ez tax form ” Gross income from the property. 2012 ez tax form   For purposes of percentage depletion, gross income from the property (in the case of oil and gas wells) is the amount you receive from the sale of the oil or gas in the immediate vicinity of the well. 2012 ez tax form If you do not sell the oil or gas on the property, but manufacture or convert it into a refined product before sale or transport it before sale, the gross income from the property is the representative market or field price (RMFP) of the oil or gas, before conversion or transportation. 2012 ez tax form   If you sold gas after you removed it from the premises for a price that is lower than the RMFP, determine gross income from the property for percentage depletion purposes without regard to the RMFP. 2012 ez tax form   Gross income from the property does not include lease bonuses, advance royalties, or other amounts payable without regard to production from the property. 2012 ez tax form Average daily production exceeds depletable quantities. 2012 ez tax form   If your average daily production for the year is more than your depletable oil or natural gas quantity, figure your allowance for depletion for each domestic oil or natural gas property as follows. 2012 ez tax form Figure your average daily production of oil or natural gas for the year. 2012 ez tax form Figure your depletable oil or natural gas quantity for the year. 2012 ez tax form Figure depletion for all oil or natural gas produced from the property using a percentage depletion rate of 15%. 2012 ez tax form Multiply the result figured in (3) by a fraction, the numerator of which is the result figured in (2) and the denominator of which is the result figured in (1). 2012 ez tax form This is your depletion allowance for that property for the year. 2012 ez tax form Taxable income limit. 2012 ez tax form   If you are an independent producer or royalty owner of oil and gas, your deduction for percentage depletion is limited to the smaller of the following. 2012 ez tax form 100% of your taxable income from the property figured without the deduction for depletion and the deduction for domestic production activities under section 199 of the Internal Revenue Code. 2012 ez tax form For a definition of taxable income from the property, see Taxable income limit , earlier, under Mineral Property. 2012 ez tax form 65% of your taxable income from all sources, figured without the depletion allowance, the deduction for domestic production activities, any net operating loss carryback, and any capital loss carryback. 2012 ez tax form You can carry over to the following year any amount you cannot deduct because of the 65%-of-taxable-income limit. 2012 ez tax form Add it to your depletion allowance (before applying any limits) for the following year. 2012 ez tax form Partnerships and S Corporations Generally, each partner or S corporation shareholder, and not the partnership or S corporation, figures the depletion allowance separately. 2012 ez tax form (However, see Electing large partnerships must figure depletion allowance , later. 2012 ez tax form ) Each partner or shareholder must decide whether to use cost or percentage depletion. 2012 ez tax form If a partner or shareholder uses percentage depletion, he or she must apply the 65%-of-taxable-income limit using his or her taxable income from all sources. 2012 ez tax form Partner's or shareholder's adjusted basis. 2012 ez tax form   The partnership or S corporation must allocate to each partner or shareholder his or her share of the adjusted basis of each oil or gas property held by the partnership or S corporation. 2012 ez tax form The partnership or S corporation makes the allocation as of the date it acquires the oil or gas property. 2012 ez tax form   Each partner's share of the adjusted basis of the oil or gas property generally is figured according to that partner's interest in partnership capital. 2012 ez tax form However, in some cases, it is figured according to the partner's interest in partnership income. 2012 ez tax form   The partnership or S corporation adjusts the partner's or shareholder's share of the adjusted basis of the oil and gas property for any capital expenditures made for the property and for any change in partnership or S corporation interests. 2012 ez tax form Recordkeeping. 2012 ez tax form Each partner or shareholder must separately keep records of his or her share of the adjusted basis in each oil and gas property of the partnership or S corporation. 2012 ez tax form The partner or shareholder must reduce his or her adjusted basis by the depletion allowed or allowable on the property each year. 2012 ez tax form The partner or shareholder must use that reduced adjusted basis to figure cost depletion or his or her gain or loss if the partnership or S corporation disposes of the property. 2012 ez tax form Reporting the deduction. 2012 ez tax form   Information that you, as a partner or shareholder, use to figure your depletion deduction on oil and gas properties is reported by the partnership or S corporation on Schedule K-1 (Form 1065) or on Schedule K-1 (Form 1120S). 2012 ez tax form Deduct oil and gas depletion for your partnership or S corporation interest on Schedule E (Form 1040). 2012 ez tax form The depletion deducted on Schedule E is included in figuring income or loss from rental real estate or royalty properties. 2012 ez tax form The instructions for Schedule E explain where to report this income or loss and whether you need to file either of the following forms. 2012 ez tax form Form 6198, At-Risk Limitations. 2012 ez tax form Form 8582, Passive Activity Loss Limitations. 2012 ez tax form Electing large partnerships must figure depletion allowance. 2012 ez tax form   An electing large partnership, rather than each partner, generally must figure the depletion allowance. 2012 ez tax form The partnership figures the depletion allowance without taking into account the 65-percent-of-taxable-income limit and the depletable oil or natural gas quantity. 2012 ez tax form Also, the adjusted basis of a partner's interest in the partnership is not affected by the depletion allowance. 2012 ez tax form   An electing large partnership is one that meets both the following requirements. 2012 ez tax form The partnership had 100 or more partners in the preceding year. 2012 ez tax form The partnership chooses to be an electing large partnership. 2012 ez tax form Disqualified persons. 2012 ez tax form   An electing large partnership does not figure the depletion allowance of its partners that are disqualified persons. 2012 ez tax form Disqualified persons must figure it themselves, as explained earlier. 2012 ez tax form   All the following are disqualified persons. 2012 ez tax form Refiners who cannot claim percentage depletion (discussed under Independent Producers and Royalty Owners , earlier). 2012 ez tax form Retailers who cannot claim percentage depletion (discussed under Independent Producers and Royalty Owners , earlier). 2012 ez tax form Any partner whose average daily production of domestic crude oil and natural gas is more than 500 barrels during the tax year in which the partnership tax year ends. 2012 ez tax form Average daily production is discussed earlier. 2012 ez tax form Natural Gas Wells You can use percentage depletion for a well that produces natural gas that is either Sold under a fixed contract, or Produced from geopressured brine. 2012 ez tax form Natural gas sold under a fixed contract. 2012 ez tax form   Natural gas sold under a fixed contract qualifies for a percentage depletion rate of 22%. 2012 ez tax form This is domestic natural gas sold by the producer under a contract that does not provide for a price increase to reflect any increase in the seller's tax liability because of the repeal of percentage depletion for gas. 2012 ez tax form The contract must have been in effect from February 1, 1975, until the date of sale of the gas. 2012 ez tax form Price increases after February 1, 1975, are presumed to take the increase in tax liability into account unless demonstrated otherwise by clear and convincing evidence. 2012 ez tax form Natural gas from geopressured brine. 2012 ez tax form   Qualified natural gas from geopressured brine is eligible for a percentage depletion rate of 10%. 2012 ez tax form This is natural gas that is both the following. 2012 ez tax form Produced from a well you began to drill after September 1978 and before 1984. 2012 ez tax form Determined in accordance with section 503 of the Natural Gas Policy Act of 1978 to be produced from geopressured brine. 2012 ez tax form Mines and Geothermal Deposits Certain mines, wells, and other natural deposits, including geothermal deposits, qualify for percentage depletion. 2012 ez tax form Mines and other natural deposits. 2012 ez tax form   For a natural deposit, the percentage of your gross income from the property that you can deduct as depletion depends on the type of deposit. 2012 ez tax form   The following is a list of the percentage depletion rates for the more common minerals. 2012 ez tax form DEPOSITS RATE Sulphur, uranium, and, if from deposits in the United States, asbestos, lead ore, zinc ore, nickel ore, and mica 22% Gold, silver, copper, iron ore, and certain oil shale, if from deposits in the United States 15% Borax, granite, limestone, marble, mollusk shells, potash, slate, soapstone, and carbon dioxide produced from a well 14% Coal, lignite, and sodium chloride 10% Clay and shale used or sold for use in making sewer pipe or bricks or used or sold for use as sintered or burned lightweight aggregates 7½% Clay used or sold for use in making drainage and roofing tile, flower pots, and kindred products, and gravel, sand, and stone (other than stone used or sold for use by a mine owner or operator as dimension or ornamental stone) 5%   You can find a complete list of minerals and their percentage depletion rates in section 613(b) of the Internal Revenue Code. 2012 ez tax form Corporate deduction for iron ore and coal. 2012 ez tax form   The percentage depletion deduction of a corporation for iron ore and coal (including lignite) is reduced by 20% of: The percentage depletion deduction for the tax year (figured without this reduction), minus The adjusted basis of the property at the close of the tax year (figured without the depletion deduction for the tax year). 2012 ez tax form Gross income from the property. 2012 ez tax form   For property other than a geothermal deposit or an oil or gas well, gross income from the property means the gross income from mining. 2012 ez tax form Mining includes all the following. 2012 ez tax form Extracting ores or minerals from the ground. 2012 ez tax form Applying certain treatment processes described later. 2012 ez tax form Transporting ores or minerals (generally, not more than 50 miles) from the point of extraction to the plants or mills in which the treatment processes are applied. 2012 ez tax form Excise tax. 2012 ez tax form   Gross income from mining includes the separately stated excise tax received by a mine operator from the sale of coal to compensate the operator for the excise tax the mine operator must pay to finance black lung benefits. 2012 ez tax form Extraction. 2012 ez tax form   Extracting ores or minerals from the ground includes extraction by mine owners or operators of ores or minerals from the waste or residue of prior mining. 2012 ez tax form This does not apply to extraction from waste or residue of prior mining by the purchaser of the waste or residue or the purchaser of the rights to extract ores or minerals from the waste or residue. 2012 ez tax form Treatment processes. 2012 ez tax form   The processes included as mining depend on the ore or mineral mined. 2012 ez tax form To qualify as mining, the treatment processes must be applied by the mine owner or operator. 2012 ez tax form For a listing of treatment processes considered as mining, see section 613(c)(4) of the Internal Revenue Code and the related regulations. 2012 ez tax form Transportation of more than 50 miles. 2012 ez tax form   If the IRS finds that the ore or mineral must be transported more than 50 miles to plants or mills to be treated because of physical and other requirements, the additional authorized transportation is considered mining and included in the computation of gross income from mining. 2012 ez tax form    If you wish to include transportation of more than 50 miles in the computation of gross income from mining, request an advance ruling from the IRS. 2012 ez tax form Include in the request the facts about the physical and other requirements that prevented the construction and operation of the plant within 50 miles of the point of extraction. 2012 ez tax form For more information about requesting an advance ruling, see Revenue Procedure 2013-1, available at www. 2012 ez tax form irs. 2012 ez tax form gov/irb/2013-01_IRB/ar11. 2012 ez tax form html. 2012 ez tax form Disposal of coal or iron ore. 2012 ez tax form   You cannot take a depletion deduction for coal (including lignite) or iron ore mined in the United States if both the following apply. 2012 ez tax form You disposed of it after holding it for more than 1 year. 2012 ez tax form You disposed of it under a contract under which you retain an economic interest in the coal or iron ore. 2012 ez tax form Treat any gain on the disposition as a capital gain. 2012 ez tax form Disposal to related person. 2012 ez tax form   This rule does not apply if you dispose of the coal or iron ore to one of the following persons. 2012 ez tax form A related person (as listed in chapter 2 of Publication 544). 2012 ez tax form A person owned or controlled by the same interests that own or control you. 2012 ez tax form Geothermal deposits. 2012 ez tax form   Geothermal deposits located in the United States or its possessions qualify for a percentage depletion rate of 15%. 2012 ez tax form A geothermal deposit is a geothermal reservoir of natural heat stored in rocks or in a watery liquid or vapor. 2012 ez tax form For percentage depletion purposes, a geothermal deposit is not considered a gas well. 2012 ez tax form   Figure gross income from the property for a geothermal steam well in the same way as for oil and gas wells. 2012 ez tax form See Gross income from the property , earlier, under Oil and Gas Wells. 2012 ez tax form Percentage depletion on a geothermal deposit cannot be more than 50% of your taxable income from the property. 2012 ez tax form Lessor's Gross Income In the case of leased property, the depletion deduction is divided between the lessor and the lessee. 2012 ez tax form A lessor's gross income from the property that qualifies for percentage depletion usually is the total of the royalties received from the lease. 2012 ez tax form Bonuses and advanced royalties. 2012 ez tax form   Bonuses and advanced royalties are payments a lessee makes before production to a lessor for the grant of rights in a lease or for minerals, gas, or oil to be extracted from leased property. 2012 ez tax form If you are the lessor, your income from bonuses and advanced royalties received is subject to an allowance for depletion, as explained in the next two paragraphs. 2012 ez tax form Figuring cost depletion. 2012 ez tax form   To figure cost depletion on a bonus, multiply your adjusted basis in the property by a fraction, the numerator of which is the bonus and the denominator of which is the total bonus and royalties expected to be received. 2012 ez tax form To figure cost depletion on advanced royalties, use the computation explained earlier under Cost Depletion , treating the number of units for which the advanced royalty is received as the number of units sold. 2012 ez tax form Figuring percentage depletion. 2012 ez tax form   In the case of mines, wells, and other natural deposits other than gas, oil, or geothermal property, you may use the percentage rates discussed earlier under Mines and Geothermal Deposits . 2012 ez tax form Any bonus or advanced royalty payments are generally part of the gross income from the property to which the rates are applied in making the calculation. 2012 ez tax form However, for oil, gas, or geothermal property, gross income does not include lease bonuses, advanced royalties, or other amounts payable without regard to production from the property. 2012 ez tax form Ending the lease. 2012 ez tax form   If you receive a bonus on a lease that ends or is abandoned before you derive any income from mineral extraction, include in income the depletion deduction you took. 2012 ez tax form Do this for the year the lease ends or is abandoned. 2012 ez tax form Also increase your adjusted basis in the property to restore the depletion deduction you previously subtracted. 2012 ez tax form   For advanced royalties, include in income the depletion claimed on minerals for which the advanced royalties were paid if the minerals were not produced before the lease ended. 2012 ez tax form Include this amount in income for the year the lease ends. 2012 ez tax form Increase your adjusted basis in the property by the amount you include in income. 2012 ez tax form Delay rentals. 2012 ez tax form   These are payments for deferring development of the property. 2012 ez tax form Since delay rentals are ordinary rent, they are ordinary income that is not subject to depletion. 2012 ez tax form These rentals can be avoided by either abandoning the lease, beginning development operations, or obtaining production. 2012 ez tax form Timber You can figure timber depletion only by the cost method. 2012 ez tax form Percentage depletion does not apply to timber. 2012 ez tax form Base your depletion on your cost or other basis in the timber. 2012 ez tax form Your cost does not include the cost of land or any amounts recoverable through depreciation. 2012 ez tax form Depletion takes place when you cut standing timber. 2012 ez tax form You can figure your depletion deduction when the quantity of cut timber is first accurately measured in the process of exploitation. 2012 ez tax form Figuring cost depletion. 2012 ez tax form   To figure your cost depletion allowance, you multiply the number of timber units cut by your depletion unit. 2012 ez tax form Timber units. 2012 ez tax form   When you acquire timber property, you must make an estimate of the quantity of marketable timber that exists on the property. 2012 ez tax form You measure the timber using board feet, log scale, cords, or other units. 2012 ez tax form If you later determine that you have more or less units of timber, you must adjust the original estimate. 2012 ez tax form   The term “timber property” means your economic interest in standing timber in each tract or block representing a separate timber account. 2012 ez tax form Depletion unit. 2012 ez tax form   You figure your depletion unit each year by taking the following steps. 2012 ez tax form Determine your cost or adjusted basis of the timber on hand at the beginning of the year. 2012 ez tax form Adjusted basis is defined under Cost Depletion in the discussion on Mineral Property. 2012 ez tax form Add to the amount determined in (1) the cost of any timber units acquired during the year and any additions to capital. 2012 ez tax form Figure the number of timber units to take into account by adding the number of timber units acquired during the year to the number of timber units on hand in the account at the beginning of the year and then adding (or subtracting) any correction to the estimate of the number of timber units remaining in the account. 2012 ez tax form Divide the result of (2) by the result of (3). 2012 ez tax form This is your depletion unit. 2012 ez tax form Example. 2012 ez tax form You bought a timber tract for $160,000 and the land was worth as much as the timber. 2012 ez tax form Your basis for the timber is $80,000. 2012 ez tax form Based on an estimated one million board feet (1,000 MBF) of standing timber, you figure your depletion unit to be $80 per MBF ($80,000 ÷ 1,000). 2012 ez tax form If you cut 500 MBF of timber, your depletion allowance would be $40,000 (500 MBF × $80). 2012 ez tax form When to claim depletion. 2012 ez tax form   Claim your depletion allowance as a deduction in the year of sale or other disposition of the products cut from the timber, unless you choose to treat the cutting of timber as a sale or exchange (explained below). 2012 ez tax form Include allowable depletion for timber products not sold during the tax year the timber is cut as a cost item in the closing inventory of timber products for the year. 2012 ez tax form The inventory is your basis for determining gain or loss in the tax year you sell the timber products. 2012 ez tax form Example. 2012 ez tax form The facts are the same as in the previous example except that you sold only half of the timber products in the cutting year. 2012 ez tax form You would deduct $20,000 of the $40,000 depletion that year. 2012 ez tax form You would add the remaining $20,000 depletion to your closing inventory of timber products. 2012 ez tax form Electing to treat the cutting of timber as a sale or exchange. 2012 ez tax form   You can elect, under certain circumstances, to treat the cutting of timber held for more than 1 year as a sale or exchange. 2012 ez tax form You must make the election on your income tax return for the tax year to which it applies. 2012 ez tax form If you make this election, subtract the adjusted basis for depletion from the fair market value of the timber on the first day of the tax year in which you cut it to figure the gain or loss on the cutting. 2012 ez tax form You generally report the gain as long-term capital gain. 2012 ez tax form The fair market value then becomes your basis for figuring your ordinary gain or loss on the sale or other disposition of the products cut from the timber. 2012 ez tax form For more information, see Timber in chapter 2 of Publication 544, Sales and Other Dispositions of Assets. 2012 ez tax form   You may revoke an election to treat the cutting of timber as a sale or exchange without IRS's consent. 2012 ez tax form The prior election (and revocation) is disregarded for purposes of making a subsequent election. 2012 ez tax form See Form T (Timber), Forest Activities Schedule, for more information. 2012 ez tax form Form T. 2012 ez tax form   Complete and attach Form T (Timber) to your income tax return if you claim a deduction for timber depletion, choose to treat the cutting of timber as a sale or exchange, or make an outright sale of timber. 2012 ez tax form Prev  Up  Next   Home   More Online Publications