§193 — Title 26 Internal Revenue Code | U.S. Code

Summary

Oil producers can deduct the cost of tertiary injectants, which are substances injected into a well as part of an approved enhanced oil recovery method, in the year they are injected. The deduction does not cover hydrocarbon injectants that are recoverable, such as natural gas or crude oil, unless only an insignificant amount of the injectant is natural gas or crude oil. No deduction is allowed here if you already elected to expense the cost under section 263(c) or if another part of the tax code already lets you deduct it.

Title 26, §193

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(a)There shall be allowed as a deduction for the taxable year an amount equal to the qualified tertiary injectant expenses of the taxpayer for tertiary injectants injected during such taxable year.

(b)For purposes of this section—

(1)The term “qualified tertiary injectant expenses” means any cost paid or incurred (whether or not chargeable to capital account) for any tertiary injectant (other than a hydrocarbon injectant which is recoverable) which is used as a part of a tertiary recovery method.

(2)The term “hydrocarbon injectant” includes natural gas, crude oil, and any other injectant which is comprised of more than an insignificant amount of natural gas or crude oil. The term does not include any tertiary injectant which is hydrocarbon-based, or a hydrocarbon-derivative, and which is comprised of no more than an insignificant amount of natural gas or crude oil. For purposes of this paragraph, that portion of a hydrocarbon injectant which is not a hydrocarbon shall not be treated as a hydrocarbon injectant.

(3)The term “tertiary recovery method” means—

(A)any method which is described in subparagraphs (1) through (9) of section 212.78(c) of the June 1979 energy regulations (as defined by section 4996(b)(8)(C) as in effect before its repeal), or

(B)any other method to provide tertiary enhanced recovery which is approved by the Secretary for purposes of this section.

(c)No deduction shall be allowed under subsection (a) with respect to any expenditure—

(1)with respect to which the taxpayer has made an election under section 263(c), or

(2)with respect to which a deduction is allowed or allowable to the taxpayer under any other provision of this chapter.

Notes & Related Subsidiaries

Editorial Notes

References in Text

section 4996(b)(8)(C), referred to in subsec. (b)(3)(A), was repealed by Pub. L. 100–418, title I, § 1941(a), Aug. 23, 1988, 102 Stat. 1322.

Amendments

1988—Subsec. (b)(3)(A). Pub. L. 100–418 substituted “section 4996(b)(8)(C) as in effect before its repeal” for “section 4996(b)(8)(C)”. 1983—Subsec. (b)(1). Pub. L. 97–448 struck out “during the taxable year” after “any cost paid or incurred”.

Statutory Notes and Related Subsidiaries

Effective Date

of 1988 AmendmentAmendment by Pub. L. 100–418 applicable to crude oil removed from the premises on or after Aug. 23, 1988, see section 1941(c) of Pub. L. 100–418, set out as a note under section 164 of this title.

Effective Date

of 1983 AmendmentAmendment by Pub. L. 97–448 effective, except as otherwise provided, as if it had been included in the provision of the Crude Oil Windfall Profit Tax Act of 1980, Pub. L. 96–223, to which such amendment relates, see section 203(a) of Pub. L. 97–448, set out as a note under section 6652 of this title.

Effective Date

Pub. L. 96–223, title II, § 251(b), Apr. 2, 1980, 94 Stat. 287, provided that: “The

Amendments

made by this section [enacting this section and amending section 263, 1245, and 1250 of this title] shall apply to taxable years beginning after December 31, 1979.”

§193 Tertiary Injectants

Summary

Title 26, §193

Notes & Related Subsidiaries

Editorial Notes

References in Text

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Effective Date

Amendments

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