depletion

An emptying, exhausting or wasting of assets. A reduction during taxable year of oil, gas or other mineral deposits or reserves (i.e., wasting assets) as a result of production. The process by which the cost or other basis of a natural resource (e.g., an oil and gas interest) is recovered upon extraction and sale of the resource
@ depletion allowance
The tax laws allow a depletion allowance (deduction) to owners of oil, gas, mineral, and timber resources as such are exhausted. The two ways to determine the depletion allowance are the cost and percentage (or statutory) methods. Under the cost method, each unit of production sold is assigned a portion of the cost or other basis of the interest. This is determined by dividing the cost or other basis by the total units expected to be recovered. I.R.C. No. 611. Under the percentage (or statutory) method the tax law provides a special percentage factor for different types of minerals and other natural resources. Such depletion is based on a percentage of the estimated gross income to be earned during the period from a natural resource, without reference to the cost of the resource. This percentage is multiplied by the gross income from the interest to arrive at the depletion allowance. I.R.C. No.No. 613 and 613A.
See also amortization
See depletion
@ depletion deduction
See depletion
@

Black's law dictionary. . 1990.

Synonyms:

Look at other dictionaries:

  • déplétion — [ deplesjɔ̃ ] n. f. • 1736; lat. depletio 1 ♦ Sc. Diminution de la quantité (de qqch.). « Si le nombre de cétacés capturés annuellement reste très élevé, il tend néanmoins à diminuer par suite de la déplétion des stocks » (J. Dorst). Méd.… …   Encyclopédie Universelle

  • Depletion — may refer to: Depletion (accounting), an accounting concept Depletion region, a concept of semiconductor physics Depletion width, a concept of semiconductor physics Grain boundary depletion, a mechanism of corrosion Oil depletion, the declining… …   Wikipedia

  • depletion — de‧ple‧tion [dɪˈpliːʆn] noun [uncountable] when an amount of something is greatly reduced or nearly all used up: • Many businessmen judged the bank s measures insufficient to prevent the continuing depletion of foreign exchange reserves. • the… …   Financial and business terms

  • Depletion — Déplétion Cette page d’homonymie répertorie les différents sujets et articles partageant un même nom. Le terme déplétion peut faire référence à : Sommaire 1 Dans les domaines de l astronautique et de l astronomie 2 …   Wikipédia en Français

  • depletion — de·ple·tion /di plē shən/ n: the reduction of the value of the assets of a company engaged in removing natural resources (as by mining) because of the decrease over time of the natural resources (as coal) available in or on the land being worked… …   Law dictionary

  • Depletion — De*ple tion, n. [Cf. F. d[ e]pl[ e]tion.] 1. The act of depleting or emptying. [1913 Webster] 2. (Med.) the act or process of diminishing the quantity of fluid in the vessels by bloodletting or otherwise; also excessive evacuation, as in severe… …   The Collaborative International Dictionary of English

  • Depletion — См. Обеднение Термины атомной энергетики. Концерн Росэнергоатом, 2010 …   Термины атомной энергетики

  • depletion — [dē plē′shən, diplē′shən] n. 1. a depleting or being depleted 2. the gradual using up or destruction of capital assets, esp. of natural resources * * * de·ple·tion (dĭ plēʹshən) n. 1. The act or process of depleting. 2. The state of being… …   Universalium

  • depletion — 1650s, from L.L. depletionem (nom. depletio) blood letting, from pp. stem of L. deplere to empty, lit. to un fill, from de off, away (see DE (Cf. de )) + plere to fill (see PLENARY (Cf. plenary)) …   Etymology dictionary

  • depletion — [dē plē′shən, diplē′shən] n. 1. a depleting or being depleted 2. the gradual using up or destruction of capital assets, esp. of natural resources …   English World dictionary

  • Depletion — An accrual accounting method that companies use to allocate the cost of extracting natural resources such as timber, minerals and oil from the earth. Depletion is calculated for tax deduction and bookkeeping purposes. Unlike depreciation and… …   Investment dictionary

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.