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Working Interest in Oil & Gas Well - Can I deduct any out of pocket expenses?

I purchased working interest in an oil & gas well this year. I know that I will be able to write off IDC in the first year of production.

Am I able to deduct any out of pocket expenses such as postage, travel to the well site to meet with operators, computer, home office expense, etc related to managing my investment or identifying my next joint venture?

My intention will be to buy working interest in multiple wells, are the deduction opportunities similar as to if I were managing multiple pieces of real estate?
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    I purchased working interest in an oil & gas well this year. I know that I will be able to write off IDC in the first year of production.==============> IDC is deductible in the year paid; you have the option to write off IDC over a 60 month period.  The costs are ordinarily capital expenditures. You can usually recover them through depreciation or depletion. However, you can elect to deduct IDCs as a current biz expense. These are certain drilling and development costs for wells in the US in which you hold an operating or working interest. You can deduct only costs for drilling or preparing a well for the production of oil, gas. You can elect to deduct only the costs of items with no salvage value. These include wages, fuel, repairs, hauling, and supplies related to drilling wells and preparing them for production. Your cost for any drilling or development work done by contractors under any form of contract is also an IDC. When your mine reaches the producing stage, you must recapture any exploration costs you elected to deduct.

     

    Am I able to deduct any out of pocket expenses such as postage, travel to the well site to meet with operators, computer, home office expense, etc related to managing my investment or identifying my next joint venture?====================>you can deduct your biz related exp on Sch C of 1040. A working interest held individually or through most pass-thru entities,i..e., PS, S corp, is considered self-employment income.  Losses can be used to offset self-employment income from other sources. You elect to deduct IDCs as a current business expense by taking the deduction on your income tax return for the first tax year you have eligible costs. No formal statement is required. If you file Sch C Form 1040, enter these costs under “Other expenses.”NOTE;for entities, Each partner, not the partnership, elects whether to capitalize or to deduct that partner's share of exploration costs. Each shareholder, not the S corp, elects whether to capitalize or to deduct that shareholder's share of exploration costs.

     

    My intention will be to buy working interest in multiple wells, are the deduction opportunities similar as to if I were managing multiple pieces of real estate?===========> gues it depends; A working interest in an oil well even though the 1099 often says 'royalties  goes on a Sch C and Sch SE, NOT on Sch E of 1040. Income from a carried working interest (working interest received for drilling a well) is subject to SE tax. As long as you are filing Sch C to report income and deductions from an oil or gas well in which you own a working interest directly or through an entity that does not limit your liability, check the “Yes” box. The activity of owning the working interest is not a passive activity regardless of your participation.

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