Special Tax Benefits of Oil and Gas – Hi-Tech Energy Group, Inc.



SPECIAL TAX BENEFITS OF OIL AND GAS

The U.S. tax code allows the following special tax benefits to investors in oil and gas drilling ventures.


  • An immediate write-off (deduction from taxable income) of 100% of all intangible costs, which typically account for as much as 70% to 80% of the cost of drilling a well. Intangible costs include the cost of drilling services, labor, chemicals used, and supplies. This immediate write-off applies to this year’s taxes even if the well is not drilled until March 31 of the following year.
  • Accelerated depreciation of tangible equipment and other costs over a 7-year period; and
  • A “depletion allowance” which normally exempts 15% of revenue from taxation.

These tax advantages allow the investor to retain earnings and re-deploy the cash in a continuing stream of new projects, thus compounding his or her base of oil and gas reserves and thereby, the net worth of the investor.

A Self-Directed IRA for Direct Investment in Oil and Gas Projects.

By setting up a self-directed IRA, you have the freedom to continue investing in the stock market if you wish, but also take advantage of income from oil and gas projects.  The process is simple –you just place a portion of your current IRA funds in a new IRA administered by a custodian who specializes in administering self-directed IRA’s and then select your own investments. This provides you with a wide latitude for investing.

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