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depletion allowance

   Also found in: Legal 0.01 sec.

depletion allowance

In tax law, the deductions from gross income allowed investors in exhaustible commodities (such as minerals, oil, or gas) for the depletion of the deposits. The depletion allowance is intended as an incentive to stimulate investment in this high-risk industry, though critics argue that mineral deposits are valuable enough to justify high levels of investment even without tax incentives. See also depreciation.



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It can be accomplished either through joint investments, royalties, or a depletion allowance, reflecting the value of that resource.
This especially is true of the fossil fuel industry; its subsidies include such things as a depletion allowance for oil pumping in the U.
One possible item some C&D landfill operators may not be getting out of their sites is a legal depletion allowance for landfills under the federal tax code.
 
 
 
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