Discover the Secret Investment Advantage
of U.S. Oil Exploration
There are many ways to benefit from oil and gas investments - learn more here...
Investing in the oil and gas industry can be a safe investment if you understand your investment objectives and your risk tolerance, and select accordingly. As with all investments, the general rule is that the higher the risk, the greater the return.
One way our government helps address the issue of risk is that it allows companies that drill for and produce oil and gas to offset some of the cost through the use of tax deductions. Oil and gas are natural resources that deplete through extraction. In other words, these are not renewable energy sources and our tax code has allowed a depletion allowance of up to 15 to 20 percent.
In addition to the depletion allowance, we have intangible drilling costs as well as tangible drilling costs. There can be additional tax benefits depending upon what type of category a particular project falls into. For example, there are tax credits for drilling tight sands as well as unconventional reservoirs.
Tax benefits are just one reason to consider investing in U.S. oil and gas exploration. Investing in oil can not only provide you with an attractive return, it may also allow you to write off a significant portion of your investment - even if you make money.
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