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Level 2
February 20, 2026
Question

Depletion Allowance

  • February 20, 2026
  • 2 replies
  • 60 views

What backup paperwork does the IRS require in order to take the depletion allowance on oil royalties? I've read that 15% is the standard amount for oil--is there someplace on the IRS website that verifies that percentage?

    2 replies

    Alumni - Intuit
    February 20, 2026

    There is no required backup paperwork in order to take depletion on oil royalties.  Using the percentage depletion method oil royalties automatically take a 15% deduction.  Here is the IRS guidance on depletion.

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    Level 2
    March 13, 2026

    Thank you.