depletion allowance

noun
a tax reduction allowed on income from exhaustible resources, as oil or timber.
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Dictionary.com's 21st Century Lexicon
Main Entry:  depletion allowance
Part of Speech:  n
Definition:  a tax break given to a corporation when its normal business activities reduce the value of its assets
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American Heritage
Cultural Dictionary

depletion allowance definition


A deduction from taxable income based on the eventual exhaustion or waste of a natural asset, such as an oil field.

The American Heritage® New Dictionary of Cultural Literacy, Third Edition
Copyright © 2005 by Houghton Mifflin Company.
Published by Houghton Mifflin Company. All rights reserved.
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Example sentences
The depletion allowance may be based on either the cost of the property or a percentage of the gross income of the property.
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