Internal Revenue Service
Revenue Ruling

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 Rev. Rul. 67-34

1967-1 C.B. 72

Tax Treaties

Sec. 263
Sec. 612

Full Text

Rev. Rul. 67-34

Pursuant to section 263(c) of the Internal Revenue Code of 1954 and section 1.612-4 of the Income Tax Regulations, a taxpayer who holds the working or operating interest in oil and gas properties has the option to capitalize or expense the intangible drilling and development costs incurred with respect to those properties. This option is available with respect to oil and gas properties although located outside the United States if the taxpayer is required to report the income from those operations for Federal income tax purposes.