The Kansas Abandoned Well Plugging Credit, claimed using Schedule K-39, provides a tax credit for qualified expenditures incurred for plugging abandoned oil and gas wells located in Kansas. The credit is intended to encourage the proper plugging of abandoned wells and support environmental protection and public safety efforts.
Eligibility and Credit Calculation
The credit is available to eligible taxpayers who incur qualified expenditures for plugging abandoned oil and gas wells in Kansas and meet the requirements established under Kansas law.
Qualified taxpayers must:
- Incur eligible expenses related to the plugging of abandoned oil and gas wells.
- Complete the required certification and documentation requirements.
- Claim the credit using Schedule K-39 with the applicable Kansas tax return.
The credit amount is generally equal to 50% of qualified expenditures incurred for eligible abandoned well plugging activities, subject to any limitations and requirements provided by Kansas law.
How to Claim the Credit
Taxpayers claiming the Kansas Abandoned Well Plugging Credit must:
- Complete Schedule K-39 – Abandoned Well Plugging Credit.
- Enter the qualified plugging expenses and calculate the allowable credit according to the Schedule K-39 instructions.
- Attach Schedule K-39 to the applicable Kansas income tax return.
Taxpayers should retain documentation supporting qualified expenditures, certifications, and other records required to substantiate the credit claimed.
Important Notes
- The Kansas Abandoned Well Plugging Credit is a nonrefundable credit, meaning it can reduce Kansas tax liability but cannot create a refund beyond the taxpayer’s tax due.
- Any unused credit amount may be carried forward to future tax years as allowed under Kansas law.
- The credit may be available to individuals, businesses, or other eligible taxpayers who meet the statutory requirements.
- Taxpayers should review the Schedule K-39 instructions for current eligibility requirements, limitations, and filing procedures.
Source:
Schedule K-39 (Kansas Abandoned Well Plugging Credit)
Disclaimer: Always verify tax information with official forms and instructions from the Kansas Department of Revenue or the IRS. For specific credits like the Abandoned Well Plugging Credit, consult the Kansas Department of Revenue’s official website or contact their Taxpayer Assistance Center for the most accurate and up-to-date guidance.