Page:United States Statutes at Large Volume 89.djvu/110

 89 STAT. 50

PUBLIC LAW 9 4 - 1 2 - - M A R. 29, 1975 the case may be, resulting from secondary or t e r t i a r y processes during the taxable year by the number of days in such taxable year, and " ( i i) in the case of a taxpayer holding a partial interest in the production from any property (including any interest held in any partnership) such taxpayer's production shall be considered to be that amount of such production determined by multiplying the total production of such property by the taxpayer's percentage participation i n the revenues from such property. " (C) TERMINATION.—This paragraph shall not apply after December 31, 1983. " (7) SPECIAL RULES.— " (A) PRODUCTION OF CRUDE OIL I N EXCESS o r DEPLETABLE

26 USC 613.

OIL QUANTITY.—If the taxpayer's average daily production of domestic crude oil exceeds h i s depletable oil quantity, the allowance under paragraph (1)(A) with respect to oil produced during the taxable year from each property in the United States shall be that amount which bears the same ratio to the amount of depletion which would have been.allowable under section 613(a) for all of the taxpayer's oil produced from such property during the taxable year (computed as if section 613 applied to all of such production a t the rate specified in paragraph (5) or (6), as the case may be) as his depletable oil quantity bears to the aggregate number of barrels representing the average daily production of domestic crude oil of the taxpayer for such year. " (B) PRODUCTION o r NATURAL GAS I N EXCESS OF DEPLETABLE

NATURAL GAS QUANTITY.—If the taxpayer's average daily production of domestic n a t u r a l gas exceeds his depletable n a t u r a l gas quantity, the allowance under paragraph (1)(B) with respect to natural gas produced during the taxable year from each property i n the United States shall be that amount which bears the same ratio to the amount of depletion which would have been allowable under section 613(a) for all of the taxpayers n a t u r a l gas produced from such property during the taxable year (computed as if section 613 applied to all of such production a t the rate specified in paragraph (5) or (6), as the case may be) as the amount of his depletable n a t u r a l g a s quantity in cubic feet bears to the aggregate number of cubic feet representing the average daily production of domestic n a t u r a l g a s of the tax p a y e r for such year. "(C)

TAXABLE INCOME FROM THE PROPERTY.—If b o t h oil

and gas are produced from the property during the taxable year, for purposes of subparagraphs (A) and (B) the taxable income from the property, in applying the 50-percent limitation in section 6 1 3 (a), shall be allocated between the oil production and the gas production in proportion to the gross income during the taxable year from each. " (D) PARTNERSHIPS.—In the case of a partnership, the depletion allowance i n the case of oil and gas wells to which this subsection applies shall be computed separately by the partners and not by the partnership. "(E)

SECONDARY OR TERTIARY PRODUCTION.—If the tax p a y e r

has production from secondary or tertiary recovery processes during the taxable year, this paragraph (under regulations prescribed by the Secretary or his delegate) shall be applied separately with respect to such production.

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