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percentage depletion

   Also found in: Financial 0.11 sec.
percentage depletion [pər′sen·tij di′plē·shən]
(petroleum engineering)
Oil- or gas-reservoir depletion allowance calculated on the basis of unit sales and initial depletable leasehold cost.


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Suspension of the 100 percent taxable income limit on percentage depletion deductions for oil and gas production from marginal properties;
The result (S900) is the percentage depletion, because it is lower than the taxable income ceiling ($2,500) applicable to oil and gas property.
Excess of percentage depletion over the adjusted basis of the property is deductible.
 
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