# Percentage Depletion on Taxes

**URL:** https://www.mineralrightsforum.com/t/percentage-depletion-on-taxes/2675
**Category:** General Mineral Rights Discussion
**Created:** [June 7, 2017, 12:34am UTC](https://www.mineralrightsforum.com/t/percentage-depletion-on-taxes/2675 "2017-06-07T00:34:11Z")
**Posts on this page:** 4
**Page:** 1

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### Author: ![jean\_austin](https://www.mineralrightsforum.com/letter_avatar_proxy/v4/letter/j/53a042/32.png) [@jean\_austin](https://www.mineralrightsforum.com/u/jean_austin)
#### Post date: [June 7, 2017, 12:34am UTC](https://www.mineralrightsforum.com/t/percentage-depletion-on-taxes/2675/1 "2017-06-07T00:34:11Z")

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I have read in the IRS Publication 535 that you can deduct a 15% depletion on oil/gas on your taxes.

It also states that if the transfer occurred between 1974-1990, a transferee cannot take this deduction.

Is anyone familiar with this regulation? Can anyone explain these years?

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### Author: ![James\_Marrow](https://www.mineralrightsforum.com/user_avatar/www.mineralrightsforum.com/james_marrow/32/14142_2.png) [@James\_Marrow](https://www.mineralrightsforum.com/u/James_Marrow)
#### Post date: [June 11, 2017, 5:33pm UTC](https://www.mineralrightsforum.com/t/percentage-depletion-on-taxes/2675/2 "2017-06-11T17:33:42Z")

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I believe this applies to “regulated gas & oil” under fixed price contracts. Pretty sure it is not generally applied to properties transferred in the normal exchange or inheritance, where the production was not subject to a fixed contract. Check with your tax preparer to research this, but I am a CPA and have never had occasion to have anything limited by this section.

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### Author: ![jean\_austin](https://www.mineralrightsforum.com/letter_avatar_proxy/v4/letter/j/53a042/32.png) [@jean\_austin](https://www.mineralrightsforum.com/u/jean_austin)
#### Post date: [June 11, 2017, 5:44pm UTC](https://www.mineralrightsforum.com/t/percentage-depletion-on-taxes/2675/3 "2017-06-11T17:44:04Z")

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I now am the revenue/royalty owner on the lease that my father sold to me in 1988. That is why I had the concern about the years of exclusion. What is a regulated gas & oil? Would I fall under that?

Thank you for your reply.

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### Author: ![system](https://www.mineralrightsforum.com/uploads/db5755/original/3X/6/c/6c7c56608c843272ad6e3662ce9562a5956f173e.png) [@system](https://www.mineralrightsforum.com/u/system)
#### Post date: [August 14, 2018, 10:26pm UTC](https://www.mineralrightsforum.com/t/percentage-depletion-on-taxes/2675/4 "2018-08-14T22:26:12Z")

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