Protecting America’s Small Oil and Gas Producers and Rural Jobs Act

This bill changes federal tax rules that let oil and gas producers deduct a percentage of their income from wells as the resource is used up (called percentage depletion). For low-producing (marginal) wells, the deduction rate would start at 15 percent and rise by 1 percentage point for each dollar the prior year's crude oil reference price falls below $70, up to 25 percent. After 2027, the $70 figure would be adjusted each year using a producer price index for drilling oil and gas wells. The bill would remove taxable income limits on this marginal-well deduction and raise the daily oil quantity eligible for the deduction from 1,000 to 2,000 barrels. The changes would apply to tax years beginning after December 31, 2026.

Full text and official record on Congress.gov

Sponsors

• Roger Marshall Republican sponsor
• 7 cosponsors