Internal Revenue Bulletin:  2003-28 

July 14, 2003 

Notice 2003-44

2003 Marginal Production Rates


Table of Contents

Section 613A(c)(6)(C) of the Internal Revenue Code defines the term “applicable percentage” for purposes of determining percentage depletion for oil and gas produced from marginal properties. The applicable percentage is the percentage (not greater than 25 percent) equal to the sum of 15 percent, plus one percentage point for each whole dollar by which $20 exceeds the reference price (determined under § 29(d)(2)(C)) for crude oil for the calendar year preceding the calendar year in which the taxable year begins. The reference price determined under § 29(d)(2)(C) for the 2002 calendar year is $22.51.

Table 1 contains the applicable percentages for marginal production for taxable years beginning in calendar years 1991 through 2003.

Notice 2003-44 Table 1
APPLICABLE PERCENTAGE FOR MARGINAL PRODUCTION
  Calendar Year Applicable Percentage  
       
  1991 15 percent  
  1992 18 percent  
  1993 19 percent  
  1994 20 percent  
  1995 21 percent  
  1996 20 percent  
  1997 16 percent  
  1998 17 percent  
  1999 24 percent  
  2000 19 percent  
  2001 15 percent  
  2002 15 percent  
  2003 15 percent  

The principal author of this notice is Jaime Park of the Office of Associate Chief Counsel (Passthroughs and Special Industries). For further information regarding this notice, contact Ms. Park at (202) 622-3120 (not a toll-free call).


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