I'm not sure we have the facts to answer your question:
- What basis are you referring to?
- Your tax basis in the interest, or
- Your basis in the underlying assets?
- A few more facts would be helpful
- The percentage depletion mechanics can get very complicated. How are you getting the information to determine the smaller of 100% of the taxable income from the property without regard to the depletion deduction or 65% taxable income limit?
- Where are you getting the information related to the gross income to determine the 15% before any limitation?
- What information are you getting in order to arrive your share of the adjusted basis of the property to calculate the depletion deduction; essentially the information to determine bullet number 2.
- This is a tax expense at the individual level (not an entity level expense) without really have an actual expense.
- Unlike cost depletion, percentage depletion is not limited to the depletable base of the property and can be deducted as long as the property generates income.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
