Legal Opinion

Exxon Corp. v. Commissioner

United States Tax Court

Decided June 6, 1994No. Docket Nos. 18618-89, 18432-90Published

Held: In computing allowance for percentage depletion, it is unreasonable to determine petitioners' 1979 "gross income from the property" for sales of natural gas after it was transported away from the wellhead by the method provided for in the last sentence of sec. 1.613-3(a), Income Tax Regs., the representative market or field prices, where those prices result in a "gross income from the property" that is approximately five times petitioners' actual contract sales revenue…

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Held: In computing allowance for percentage depletion, it is unreasonable to determine petitioners' 1979 "gross income from the property" for sales of natural gas after it was transported away from the wellhead by the method provided for in the last sentence of sec. 1.613-3(a), Income Tax Regs., the representative market or field prices, where those prices result in a "gross income from the property" that is approximately five times petitioners' actual contract sales revenue in connection with such sales; accordingly, in this case it is reasonable to use a net-back method. Respondent's motion…

1Opinion of the Court

Exxon Corporation and Affiliated Companies, Petitioners v. Commissioner of Internal Revenue, Respondent

Exxon Corp. v. Commissioner

Docket Nos. 18618-89, 18432-90

United States Tax Court

102 T.C. 721; 1994 U.S. Tax Ct. LEXIS 36; 102 T.C. No. 33;

June 6, 1994, Filed

An order granting respondent's motion for partial summary judgment and denying petitioners' cross-motion for partial summary judgment will be issued.

Held: In computing allowance for percentage depletion, it is unreasonable to determine petitioners' 1979 "gross income from the property" for sales of natural gas after it was transported…

2Cases cited63 opinions

  1. United States v. American Trucking AssociationsSupreme Court of the United States · 1940
  2. Church of the Holy Trinity v. United StatesSupreme Court of the United States · 1892
  3. Public Citizen v. United States Department of JusticeSupreme Court of the United States · 1989
  4. Watt v. AlaskaSupreme Court of the United States · 1981
  5. United Steelworkers of America v. WeberSupreme Court of the United States · 1979

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