For federal income tax purposes, the depletion expense deducted from income is the larger of cost depletion or----------- .

Question

Quizplus · Accepted Answer

Percentage depletion allows taxpayers to deduct a fixed percentage of the gross income from the extraction of natural resources, often resulting in a larger deduction than cost depletion, which is based on the actual cost of the resource and its remaining quantity.

For Federal Income Tax Purposes, the Depletion Expense Deducted from Income