Structuring Oil and Gas Entities Post-Tax Reform: Key Planning Techniques and Limitations Under New Tax Law

Description

The new tax law has a significant impact on the oil and gas industry because its assets and investments are held in a variety of entity types, including partnerships, sole proprietorships, C corporations and S corporations.

Taxpayers, counsel and advisers must carefully consider the new tax law provisions when selecting the type of entity for oil and gas projects and investments, the transferability of assets and interests, and other key items in order to ensure tax savings and avoid any unintended pitfalls.

The fluctuation of oil prices combined with the reduction in tax rates and repeal of the corporate alternative minimum tax causes the oil and gas industry to reconsider enity structures and re-evaluate practices in relation to percentage depletion, tax credits, and intangible drilling and development costs.

The new tax law eliminates or limits many tax breaks with most of the tax relief being temporary. Oil and gas counsel and advisers must understand the complex rules and limitations relating to net operating losses, the new Section 199A pass-through deduction, the depreciation of certain property, and other challenges specific to oil and gas.

Listen as our panel discusses key provisions of the new tax law impacting oil and gas, choice of entity considerations, limitations in structuring oil and gas transactions post-tax reform, and effective planning methods for oil and gas projects and investments in light of new tax law provisions.