(Download) "Retsal Drilling Co. v. Commissioner of Internal Revenue." by United States Court of Appeals for the Fifth Circuit # eBook PDF Kindle ePub Free
eBook details
- Title: Retsal Drilling Co. v. Commissioner of Internal Revenue.
- Author : United States Court of Appeals for the Fifth Circuit
- Release Date : January 17, 1942
- Genre: Law,Books,Professional & Technical,
- Pages : * pages
- Size : 70 KB
Description
This is another of that growing body of cases in which the taxpayer makes claim that moneys expended for drilling and equipping oil wells, are deductible under the intangible drilling and development costs option. Expenditures on eighteen wells are involved. Seven of the eighteen were drilled under contracts which provided that the owner would "furnish fuel, water, storage tanks, connections and all other material necessary and incident to the drilling and completing of the wells other than that which the contractor has obligated himself to furnish." The contractor was obligated to drill the well, furnish the drill rig and machinery, labor and workmens compensation, surface casing, permanent casing, tubing, cement, derricks and slush pits, for a consideration of $6500 for the equipment and $6,000 for the labor, insurance, drilling expenses, etc., payable partly in cash and partly in oil. Eleven of the wells were drilled under contracts requiring the owner to furnish water, fuel, tanks, flow lines and a man to supervise the drilling of the sand area and the running of casing and also to swab the well, the contractor was to furnish slush pits, surface pipe, derrick, pipes, casing, connections, etc., and all drilling equipment, labor, tools and supplies, incident to the drilling of the well, other than those to be furnished by petitioner. The contract further provided "these wells to be drilled to the Woodbine sand found at 3600 to 3650 feet." For the taxable years the petitioner, in accordance with its consistent practice in prior years, elected to charge off all of its intangible drilling and development costs incurred in drilling operations. Of the amounts so charged, respondent disallowed payment made to the drilling contractors under the contracts described above. The Board, turning its decision upon the fact that the "relationship between the parties was not that of employer and employee, but that of independent contractors", and that though the contracts were not, they were analogous to, turn key contracts and were controlled by the same rule, affirmed the Commissioners determination.
 "Retsal Drilling Co. v. Commissioner of Internal Revenue." by United States Court of Appeals for the Fifth Circuit # eBook PDF Kindle ePub Free){kind=link}