Official Summaries

Promoting Domestic Energy Production Act

This bill allows corporations to reduce their adjusted financial statement income to account for certain intangible costs related to oil, gas, or geothermal well drilling and development for purposes of calculating the corporate alternative minimum tax.

Under current law, a 15% corporate alternative minimum tax is imposed on a corporation with adjusted financial statement income exceeding an average of $1 billion for a consecutive three-year period (or an average of $100 million for a U.S. corporation that is part of a foreign parent multinational group if the adjusted financial statement income of such group exceeds an average of $1 billion for a consecutive three-year period). Adjusted financial statement income generally is the net income or loss reported on the corporation’s applicable financial statement for a tax year, with adjustments for specific items.

This bill expands the reductions that may be made to a corporation’s adjusted financial statement income to include (1) intangible drilling and development costs incurred by an operator of a domestic oil, gas, or geothermal well that are allowed as a deduction in the current tax year when computing regular taxable income; and (2) any depletion expenses related to the intangible oil, gas, or geothermal well drilling and development costs.

Current Full Text

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 662 Introduced in House (IH)]

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119th CONGRESS
  1st Session
                                H. R. 662

To amend the Internal Revenue Code of 1986 to allow intangible drilling 
and development costs to be taken into account when computing adjusted 
                      financial statement income.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 23, 2025

Mr. Carey (for himself, Mr. Vicente Gonzalez of Texas, Mr. Langworthy, 
 Mr. Rulli, Mr. Davidson, Mr. Crenshaw, Mr. Zinke, Mr. Balderson, Mr. 
 Veasey, Mr. LaHood, Mr. Carter of Texas, Mr. Meuser, Mr. Thompson of 
   Pennsylvania, Mrs. Miller of Illinois, Mr. Hern of Oklahoma, Ms. 
   Tenney, Mrs. Miller of West Virginia, Mr. Williams of Texas, Mr. 
Cuellar, Mr. Hunt, Mr. Mann, Mr. Miller of Ohio, Mr. Cole, Mr. Weber of 
   Texas, Mr. Newhouse, Mr. McDowell, Mr. Fallon, Ms. Van Duyne, Mr. 
 Murphy, Mr. Ellzey, Mr. Babin, Mr. Evans of Colorado, Mr. Goldman of 
 Texas, and Ms. Malliotakis) introduced the following bill; which was 
              referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to allow intangible drilling 
and development costs to be taken into account when computing adjusted 
                      financial statement income.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Promoting Domestic Energy Production 
Act''.

SEC. 2. INTANGIBLE DRILLING AND DEVELOPMENT COSTS TAKEN INTO ACCOUNT 
              FOR PURPOSES OF COMPUTING ADJUSTED FINANCIAL STATEMENT 
              INCOME.

    (a) In General.--Section 56A(c)(13) of the Internal Revenue Code of 
1986 is amended--
            (1) by striking subparagraph (A) and inserting the 
        following:
                    ``(A) reduced by--
                            ``(i) depreciation deductions allowed under 
                        section 167 with respect to property to which 
                        section 168 applies to the extent of the amount 
                        allowed as deductions in computing taxable 
                        income for the year, and
                            ``(ii) any deduction allowed for expenses 
                        under section 263(c) with respect to property 
                        described therein to the extent of the amount 
                        allowed as deductions in computing taxable 
                        income for the year, and'', and
            (2) by striking subparagraph (B)(i) and inserting the 
        following:
                            ``(i) to disregard any amount of--
                                    ``(I) depreciation expense that is 
                                taken into account on the taxpayer's 
                                applicable financial statement with 
                                respect to such property, and
                                    ``(II) depletion expense that is 
                                taken into account on the taxpayer's 
                                applicable financial statement with 
                                respect to the intangible drilling and 
                                development costs of such property, 
                                and''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2025.
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