Section 15.55.223. Cook Inlet lease expenditures incurred before July 1, 2007.

	(a)  In calculating an annual production tax value for a segment described in 15 AAC 55.205(c)(1)(C) or (D), a producer shall deduct applicable adjusted lease expenditures for the calendar year to the maximum extent that deductibility is allowed under applicable law, including (b) of this section.  
	(b)  For a calendar year for which a limitation under AS 43.55.011(j) or (k), as the provisions of those subsections read on June 30, 2007, on the tax levied by AS 43.55.011(e) and (g), as the provisions of those subsections read on June 30, 2007, would have the effect, before reallocation of adjusted lease expenditures under this section, of reducing the producer's tax on oil or gas produced from one or more leases or properties below the amount of the tax that would be levied in the absence of that limitation, the producer shall reallocate under this subsection adjusted lease expenditures that are excess adjusted lease expenditures, if any, under 15 AAC 55.205(b) in the calculation of annual production tax values for segments described in 15 AAC 55.205(c)(1)(C) or (D). The producer shall (1) calculate the total amount of those excess adjusted lease expenditures; (2) multiply that total amount by 20 percent; (3) calculate for each lease or property the amount by which a limitation under AS 43.55.011(j) or (k), as the provisions of those subsections read on June 30, 2007, would reduce, before reallocation of adjusted lease expenditures under this section, the amount of the producer's tax levied by AS 43.55.011(e) and (g), as the provisions of those subsections read on June 30, 2007; (4) calculate the total of the reductions calculated under (3) of this subsection for all affected leases or properties; (5) if the amount calculated under (2) of this subsection is greater than the amount calculated under (4) of this subsection, subtract the latter from the former; and (6) multiply the amount, if any, calculated under (5) of this subsection by five. The amount, if any, calculated under (6) of this subsection is the only amount of the excess adjusted lease expenditures applicable to segments described in 15 AAC 55.205(c)(1)(C) or (D) that may be used to establish a carried-forward annual loss, to the extent allowed under AS 43.55.023(b) and 43.55.160(e). The other excess adjusted lease expenditures applicable to segments described in 15 AAC 55.205(c)(1)(C) or (D) are considered to be reallocated to, and deducted in calculating production tax values for, other segments described in 15 AAC 55.205(c)(1)(C) or (D).   
	(c)  This section applies to lease expenditures incurred before July 1, 2007.  

Authorities

43.05.080;43.55.011;43.55.110;43.55.160;43.55.165

Notes

Reference

15 AAC 55.205
15 AAC 55.340
15 AAC 55.800
15 AAC 55.805

Authority

AS 43.05.080 AS 43.55.011 AS 43.55.110 AS 43.55.160 AS 43.55.165

History

Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192