PUBLIC LAW 95-618—NOV. 9, 1978
9 2 STAT. 3 2 0 3
" (E) geothermal property (as determined under section Ql^\» ^ 26 USC 614. (e) EFFECTIVE D A T E. —
26 USC 263 note.
(1) IN GENERAL.—The amendments made by this section shall apply with respect to wells commenced on or after October 1, 1978, in taxable years ending on or after such date. • n (2) ELECTION.—The taxpayer may elect to capitalize or deduct any costs to which section 263(c) of the I n t e r n a l Revenue Code of 1954 applies by reason of the amendments made by this section. 26 USC 263. Any such election shall be made before the expiration of the time for filing claim for credit o r refund of any overpayment of tax imposed by chapter 1 of such Code with respect to the taxpayer's first taxable year to which the amendments made by this section apply and for which he pays o r incurs costs to which such section 263(c) applies by reason o i the amendments made by this section. Any election under this paragraph may be changed o r revoked at any time before the expiration of the time referred to in the preceding sentence, but after the expiration of such time such election may not be changed or revoked. SEC. 403. DEPLETION FOR GEOTHERMAL DEPOSITS AND NATURAL GAS FROM GEOPRESSURED BRINE. (a) GEOTHERMAL DEPOSITS.—
(1) IN GENERAL.—Section 613 (relating to percentage deple- 26 USC 613. tion) is amended by a d d i n g at the end thereof the following new subsection: " (e) PERCENTAGE DEPLETION FOR GEOTHERMAL D E P O S I T S. —
" (1) IN GENERAL.—In the case of geothermal deposits located in the United States or in a possession of the United States, for purposes of subsection (a) — " (A) such deposits shall be treated as listed in subsection (b),and " (B) the applicable percentage (determined under the table contained in paragraph (2)) shall be deemed to be the percentage specified in subsection (b). "(2)
APPLICABLE PERCENTAGE.—For purposes of
"In the case of taxable years beginning in calendar year— 1978, 1979, or 1980 1981 1982 1983 1984 and thereafter "(3)
paragraph
The applicable percentage is— 22 20 18 16 15
GEOTHERMAL DEPOSIT DEFINED.—For purposes of
para-
g r a p h (1), the term 'geothermal deposit' means a geothermal reservoir consisting of natural heat which is stored in rocks or in a n aqueous liquid or vapor (whether or not under pressure). Such a deposit shall i n no case be treated as a gas well for purposes of this section or section 613A, and this section shall not 26 USC 613A. a p p l y to a geothermal deposit which is located outside the United States or its possessions." (2) T E C H N I C A L AMENDMENTS.—
(A) Paragraph (1) of section 613(c) (defining gross income from the property) is amended by inserting " and other than a geothermal deposit" after "oil or gas well".
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