80 STAT. ]
PUBLIC LAW 8 9 - 5 7 0 - S E P T. 12, 1966
759
Public Law 89-570 AN ACT
Relating to the income tax treatment of exploration expenditures in the case
September 12, 1966
[H. R. 466 5]—
of niiiiini?.
Be it enacted by the Senate mid Iloin^e of Repf-eHeniat'iveH of the Income tax e s. Vruted States of America m (Umgress aa-sembled^ That (a) part I Mining exploraof subchapter I of chapter 1 of the Internal Revenue Code of 195-i tio'n exp^endliurTs (relating to natural resources) is amended by adding at the end ^l^,,V'^^i^?l\^ \
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^O U s e 6 11-616
thereof the following nevr section: "SEC. 617. ADDITIONAL EXPLORATION EXPENDITURES IN THE CASE OF DOMESTIC MINING. •'(a) ALLOWANCE or DEDUCTION.— " (1) GENERAL RULE.—At the election of the taxpayer, expendi-
tures paid or incurred during the taxable year for the purpose of ascertaining the existence, location, extent, or quality of any deposit of ore or other mineral in the United States or on the Outer Continental Shelf (within the meaning of section 2 of the Outer Continental Shelf Lands Act, as amended and supplemented; 43 U.S.C. 1331), and paid or incurred before the begin- ^^ ^tat. 462. ning of the development stage of the mine, shall be allowed as;i deduction in computing taxable income. This subsection shall apply only with respect to the amount of such expenditures which, but for this subsection, would not be allowable as a deduction for the taxable year. This subsection shall not apply to expenditures for the acquisition or improvement of property of a character which is subject to the allowance for depreciation provided in section 167, but allowances for depreciation shall be considered, ^^^ ^*^*- ^^• for purposes of this subsection, as expenditures paid or incurred. In no case shall this subsection apply with respect to amounts paid or incurred for the purpose of ascertaining the existence, location, extent, or quality of any deposit of oil or gas or of any mineral with respect to which a deduction for percentage depletion is not allowable under section 613. ^^^ ^^^*- 2°^" (2) ELECTIONS.—
" (A) METHOD.—Any election under this subsection shall be made in such manner as the Secretary or his delegate may by regulations prescribe. " (B) TIME AND SCOPE.—The election provided by paragraph (1) for the taxable year may be made at any time before the expiration of the period prescribed for making a claim for credit or refund of the tax imposed by this chapter for the taxable year. Such an election for the taxable year shall apply to all expenditures described in paragraph (1) paid or incurred by the taxpayer during the taxable year or during any subsequent taxable year. Such an election may not be revoked after the last day of the third month following the month in which the final regulat'ons issued under the authority of this subsection are published in the Federal Register, unless the Secretary or his delegate con::ents to such revocation. " (C) DEFICIENCIES.—The statutory period for the assessment of any deficiency for any taxable year, to the extent such deficiency is attributaWe to an election or revocation of an election under this subsection, shall not expire before the last day of the 2-year period beginning on the day after the date on which such election or revocation of election is
Regulations.
Publication in Federal Register.
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