Provisions Of The Tax Reform Act of 1976 Directly Affecting The Domestic Oil Gas Industry

The comprehensive Tax Reform Act of 1976 ("the Act") makes substantial changes in the taxation of oil and gas transactions. The changes most affecting oil and gas operators include "at risk" limitations on deductions for expenses, reduction in capital gains benefits allowable on certain oil and gas properties, and new minimum tax provisions. In addition, the Act's percentage-depletion provisions clarify previous laws.