
INSIGHTS FROM OUR NATIONAL TAX OFFICE	FEBRUARY 9, 2015

Oil Extraction Tax Reduction Available for New Wells

North Dakota Tax Commissioner Ryan Rauschenberger recently announced that there has been a rate reduction on oil extraction tax for new wells. As of February 1, 2015, the oil extraction tax rate will drop from 6.5 percent to 2 percent for either the first 75,000 barrels produced or the first $4.5 million of gross value for 18 months after the well is complete.

A tax incentive has never before been triggered by the Office of the Tax Commissioner, so this is a first for North Dakota. The goal of this reduction, also known as the "small trigger incentive," is to promote continued production even while oil prices are low. This incentive applies only to wells that are completed after February 1, 2015, and will remain in effect through June 30, 2015.

Click here to read the news release from Rauschenberger's office.

Please contact your Eide Bailly professional for additional information.

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This article is intended to provide readers with guidance in tax matters. The article does not constitute, and should not be treated as professional advice regarding the use of any particular tax technique. Every effort has been made to assure the accuracy of the information. Eide Bailly LLP and the author do not assume responsibility for any individual's reliance upon the information provided in the article. Readers should independently verify all information before applying it to a particular fact situation, and should independently determine the impact of any particular tax planning technique before recommending the technique to a client or implementing it on the client's behalf. To request reprints of this publication, send a written request to RequestReprints@eidebailly.com. © 2015 Eide Bailly LLP.