Form 8830 Enhanced Oil Recovery Credit

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I.R.S. SPECIFICATIONS
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INSTRUCTIONS TO PRINTER
FORM 8830, PAGE 1 of 2
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8830

Action

Date

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Revised proofs
requested

OMB No. 1545-1282

Enhanced Oil Recovery Credit
䊳

2005

Attach to your tax return.

Attachment
Sequence No.

Department of the Treasury
Internal Revenue Service

Name(s) shown on return

Part I
1
2
3

Current Year Credit

Qualified enhanced oil recovery costs (see instructions)
Multiply line 1 by 15% (.15)
Enhanced oil recovery credits
If you are a— Then enter the total of the current year credits from—
from pass-through entities:

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8a
b
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d
e
f
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Shareholder
Partner

Schedule K-1 (Form 1120S), Box 13, code F, G, or U
Schedule K-1 (Form 1065), Box 15, code F, G, or U

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2

Current year credit. Add lines 2 and 3

Part II

78

Identifying number

a
b

4

Signature

3
4

Allowable Credit (See Who must file Form 3800 to find out if you complete Part II or file Form 3800.)

Regular tax before credits:
Individuals. Enter the amount from Form 1040, line 44
Corporations. Enter the amount from Form 1120, Schedule J, line 3; Form 1120-A,
Part I, line 1; or the amount from the applicable line of your return
Estates and trusts. Enter the sum of the amounts from Form 1041, Schedule G, lines 1a
and 1b, or the amount from the applicable line of your return
Alternative minimum tax:
Individuals. Enter the amount from Form 6251, line 35
Corporations. Enter the amount from Form 4626, line 14
Estates and trusts. Enter the amount from Form 1041, Schedule I, line 56
Add lines 5 and 6
8a
Foreign tax credit
8b
Credits from Form 1040, lines 48 through 54
8c
Possessions tax credit (Form 5735, line 17 or 27)
8d
Nonconventional source fuel credit (Form 8907, line 23)
8e
Other specified credits (see instructions)

Add lines 8a through 8e
Net income tax. Subtract line 8f from line 7. If zero, skip lines 10 through 13 and enter -0- on line 14
10
Net regular tax. Subtract line 8f from line 5. If zero or less, enter -0Enter 25% (.25) of the excess, if any, of line 10 over $25,000 (see
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instructions)

Tentative minimum tax (see instructions):
Individuals. Enter the amount from Form 6251, line 33
Corporations. Enter the amount from Form 4626, line 12
Estates and trusts. Enter the amount from Form 1041,
12
Schedule I, line 54
Enter the greater of line 11 or line 12
Subtract line 13 from line 9. If zero or less, enter -0Credit allowed for the current year. Enter the smaller of line 4 or line 14 here and on Form
1040, line 55; Form 1120, Schedule J, line 6d; Form 1120-A, Part I, line 2; Form 1041, Schedule
G, line 2c; or the applicable line of your return. If line 14 is smaller than line 4, see instructions

General Instructions

Amount of Credit

Section references are to the Internal
Revenue Code unless otherwise noted.

The credit generally is 15% of qualified
costs for the year, but is reduced when the
reference price per barrel exceeds the
base value of $28 (as adjusted by inflation).
For 2005, there is no reduction of the
credit.

Purpose of Form
Use Form 8830 to claim the enhanced oil
recovery credit.
An owner of an operating mineral
interest may claim or elect not to claim this
credit any time within 3 years from the due
date (excluding extensions) of its return on
either its original or an amended return.
This credit is part of the general business
credit.

Definitions
Qualified enhanced oil recovery costs
means:
1. Any amount paid or incurred during
the tax year for tangible property—
a. That is an integral part of a qualified
enhanced oil recovery project and

For Paperwork Reduction Act Notice, see page 2.

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8f
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b. For which depreciation (or
amortization) is allowable.
2. Any intangible drilling and
development costs—
a. That are paid or incurred in
connection with a qualified enhanced oil
recovery project and
b. For which the taxpayer may make an
election under section 263(c). For an
integrated oil company, this includes
intangible drilling costs required to be
amortized under section 291(b).
3. Any qualified tertiary injectant
expenses (as defined in section 193(b))
paid or incurred in connection with a
qualified enhanced oil recovery project for

Cat. No. 13059B

Form

8830

(2005)

6
I.R.S. SPECIFICATIONS

TO BE REMOVED BEFORE PRINTING

INSTRUCTIONS TO PRINTER
FORM 8830, PAGE 2 of 2
MARGINS: TOP 13 mm (1⁄2 "), CENTER SIDES.
PAPER: WHITE WRITING, SUB. 20
FLAT SIZE: 203 mm (8")  279 mm (11")
PERFORATE: (NONE)

PRINTS: HEAD TO HEAD
INK:BLACK

DO NOT PRINT — DO NOT PRINT — DO NOT PRINT — DO NOT PRINT

Form 8830 (2005)

which a deduction is allowable for the tax
year. Qualified tertiary injectant expenses
includes expenditures related to the use of
a tertiary injectant as well as expenditures
related to the acquisition (whether
produced or acquired by purchase) of the
tertiary injectant. However, it does not
include costs that would have been paid or
incurred in the development or operation of
a mineral property if an enhanced oil
recovery project had not been implemented
with respect to the property. Costs that are
related to the use of a tertiary injectant and
that also are related to other activities (for
example, primary or secondary recovery)
must be reasonably allocated among the
tertiary injectant and the other activities to
determine the amount of tertiary injectant
expenses paid or incurred for the tax year.
For more details, see Rev. Rul. 2003-82,
2003-30 I.R.B. 125.
4. Any amount paid or incurred during
the tax year to construct an Alaska natural
gas plant within the meaning of sections
43(c)(1)(D) and 43(c)(5).
Qualified enhanced oil recovery project
means any project involving the application
of one or more tertiary recovery methods
defined in section 193(b)(3) (and listed
below) that can reasonably be expected to
result in more than an insignificant increase
in the amount of crude oil that will ultimately
be recovered. The project must be located
within the United States, including the
seabed and subsoil adjacent to the
territorial waters of the United States over
which the United States has exclusive rights
by international law for exploration and
exploitation of natural resources (see
section 638(1)). The first injection of liquids,
gases, or other matter must begin after
1990. However, any significant expansion
after 1990 of a project begun before 1991 is
treated as a project where the first injection
begins after 1990.
Additionally, the operator or designated
owner must file a certification from a
petroleum engineer, who is registered or
certified by a state, that the project meets
the above requirements. The operator or
designated owner also must file a
certification each subsequent year
indicating that the project continues to be
implemented substantially in accordance
with the petroleum engineer’s certification.
If the application of a tertiary recovery
method is terminated, the operator or
designated owner must file a notice of
project termination for the tax year when
the project terminates.
Send these filings to the Ogden
Submission Processing Center, P.O. Box
9941, Ogden, UT 84409, by the due date
of the operator’s or designated owner’s
Federal income tax return. See Regulations
section 1.43-3 for the information required
in the notice and certifications.
Tertiary recovery methods qualifying for
the credit include:
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Miscible fluid displacement,
Steam drive injection,
Microemulsion flooding,
In situ combustion,

Page

● Polymer-augmented water flooding,
● Cyclic-steam injection,
● Alkaline (or caustic) flooding,
● Carbonated water flooding,
● Immiscible nonhydrocarbon gas
displacement, or
● Any other method approved by the
Secretary of the Treasury.

● Form 8910, Alternative Motor Vehicle
Credit, line 18; and
● Form 8911, Alternative Fuel Vehicle
Refueling Property Credit, line 19.

Specific Instructions

Line 12

Part I
Current Year Credit

Although you may not owe alternative
minimum tax (AMT), you generally must
still compute the tentative minimum tax
(TMT) to figure your credit. For a small
corporation exempt from the AMT under
section 55(e), enter zero. Otherwise,
complete and attach the AMT form or
schedule and enter the TMT on line 12.

Figure any enhanced oil recovery credit
from your own trade or business on lines 1
and 2. Skip lines 1 and 2 if you are only
claiming a credit that was allocated to you
from an S corporation or a partnership.

S Corporations and Partnerships
Figure the total credit on lines 1 through 4.
Then allocate the line 4 credit among the
individual shareholders or partners in the
same way that income and loss are
shared. Electing large partnerships include
this credit in “general credits.”
Line 1
Enter the total of the qualified costs paid
or incurred during the year in connection
with a qualified enhanced oil recovery
project. See Definitions above.
Reduce the otherwise allowable
deductions for line 1 costs by the line 2
credit attributable to these costs. Also, if
any part of the line 1 costs are for
expenditures that increase the basis of
property, reduce the otherwise allowable
basis increase by the line 2 credit
attributable to these costs.

Part II
Allowable Credit
The credit allowed for the current year may
be limited based on your tax liability. Use
Part II to figure the allowable credit unless
you must file Form 3800, General Business
Credit.
Who must file Form 3800. You must file
Form 3800 if you have:
● An enhanced oil recovery credit from a
passive activity,
● More than one credit included in the
general business credit (other than a credit
from Form 8844, Form 6478, or Section B
of Form 8835), or
● A carryback or carryforward of any of
those credits.
See the instructions for Form 3800 to
find out which credits are included in the
general business credit.
Line 8e
Include on line 8e any amounts claimed
on:
● Form 8834, Qualified Electric Vehicle
Credit, line 20;

2

Line 11
See section 38(c)(5) for special rules that
apply to married couples filing separate
returns, controlled corporate groups,
regulated investment companies, real estate
investment trusts, and estates and trusts.

Line 15
If you cannot use all of your credit because
of the tax liability limit (line 14 is smaller
than line 4), carry the unused credit back 1
year and then forward up to 20 years. See
the instructions for Form 3800 for details.

Paperwork Reduction Act Notice. We
ask for the information on this form to
carry out the Internal Revenue laws of the
United States. You are required to give us
the information. We need it to ensure that
you are complying with these laws and to
allow us to figure and collect the right
amount of tax.
You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB
control number. Books or records relating
to a form or its instructions must be
retained as long as their contents may
become material in the administration of
any Internal Revenue law. Generally, tax
returns and return information are
confidential, as required by section 6103.
The time needed to complete and file
this form will vary depending on
individual circumstances. The estimated
burden for individual taxpayers filing this
form is approved under OMB control
number 1545-0074 and is included in the
estimates shown in the instructions for
their individual income tax return. The
estimated burden for all other taxpayers
who file this form is shown below.
Recordkeeping
Learning about the
law or the form
Preparing and
sending the form
to the IRS

5 hr., 15 min.
53 min.

1 hr., 1 min.

If you have comments concerning the
accuracy of these time estimates or
suggestions for making this form simpler,
we would be happy to hear from you. See
the Instructions for the tax return with
which this form is filed.