Intangible Drilling Costs - IDC

Costs to develop an oil or gas well for the elements that are not a part of the final operating well. Intangible drilling costs (IDCs) include all expenses made by an operator incidental to and necessary in the drilling and preparation of wells for the production of oil and gas, such as survey work, ground clearing, drainage, wages, fuel, repairs, supplies and so on. Broadly speaking, expenditures are classified as IDCs if they have no salvage value. Since IDCs include all real and actual expenses except for the drilling equipment, the word "intangible" is something of a misnomer.

The IDCs deduction has been allowed in the US since 1913 in order to attract investment capital to the high-risk business of oil and gas exploration. If a taxpayer makes an election to expense IDCs, the taxpayer deducts the amount of the IDCs in the taxable year in which it was paid or incurred.

Investment dictionary. . 2012.

Look at other dictionaries:

  • intangible drilling costs — Costs incurred incident to and necessary for the drilling and preparation of oil or gas wells for production that have no salvage value. Under I.R.C. No. 263, such costs may be deducted in the year paid rather than capitalized and depreciated …   Black's law dictionary

  • amortization — Fin 1. a method of recovering (deducting or writing off) the capital costs of intangible assets over a fixed period of time. EXAMPLE For tax purposes, the distinction is not always made between amortization and depreciation, yet amortization… …   The ultimate business dictionary

  • Tax Preference Item — A type of income, normally tax free, that may trigger the alternative minimum tax (AMT) for taxpayers. Tax preference items include private activity municipal bond interest, the qualifying exclusion for small business stock and excess intangible… …   Investment dictionary

  • незапланированные затраты на бурение — — [ russkiy slovar neftegazovoy promyishlennosti/] Тематики нефтегазовая промышленность EN intangible drilling costs …   Справочник технического переводчика

  • расходы, которые невозможно возместить после бурения и завершения скважины — (оплата труда, расходы на горючее, расходные материалы, рентные платежи) [ russkiy slovar neftegazovoy promyishlennosti/] Тематики нефтегазовая промышленность EN intangible drilling and development costs …   Справочник технического переводчика

  • environment — environmental, adj. environmentally, adv. /en vuy reuhn meuhnt, vuy euhrn /, n. 1. the aggregate of surrounding things, conditions, or influences; surroundings; milieu. 2. Ecol. the air, water, minerals, organisms, and all other external factors… …   Universalium

  • tangible — Having or possessing physical form. Capable of being touched and seen; perceptible to the touch; tactile; palpable; capable of being possessed or realized; readily apprehensible by the mind; real; substantial @ tangible assets Assets with… …   Black's law dictionary

  • Risk management — For non business risks, see risk, and the disambiguation page risk analysis Example of risk management: A NASA model showing areas at high risk from impact for the International Space Station. Risk management is the identification, assessment,… …   Wikipedia

  • Iraq — For other uses, see Iraq (disambiguation). Republic of Iraq جمهورية العراق (Arabic) …   Wikipedia

  • товарищество с ограниченной ответственностью по добыче нефти и газа — Товарищество с ограниченной ответственностью, включающее одного или более партнеров, несущих ограниченную ответственность, и одного или более генеральных (полных) партнеров и созданное с целью поиска, добычи и продажи коммерчески рентабельных… …   Финансово-инвестиционный толковый словарь

  • Windfall profits tax — A windfall profits tax is a higher tax rate on profits that ensue from a sudden windfall gain to a particular company or industry. United StatesIn 1980, the United States enacted the Crude Oil Windfall Profit Tax Act (P.L. 96 223) as part of a… …   Wikipedia

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.