What does SHORT TITLE. of Protecting America’s Small Oil and Gas Producers and Rural Jobs Act do?

This bill is formally titled Protecting America's Small Oil and Gas Producers and Rural Jobs Act

What does MODIFICATION OF CERTAIN PERCENTAGE DEPLETION RULES WITH RESPECT of Protecting America’s Small Oil and Gas Producers and Rural Jobs Act do?

This section modifies percentage depletion rate calculations for marginal oil and gas properties under Section 613A(c)(6)(C) of the Internal Revenue Code of 1986. The applicable percentage is calculated as 15 percent plus 1 percentage point for each whole dollar by which $70 exceeds the reference price for crude oil. Starting in calendar years after 2027, the $70 amount will be adjusted by a Producer Price Index (PPI) adjustment factor. The PPI adjustment factor is based on the difference between the PPI for drilling oil and gas wells in the preceding year and the PPI in 2026. The PPI for any calendar year is determined by the average of the Producer Price Index as published by the Bureau of Labor Statistics. A limitation on taxable income does not apply to depletion allowances determined under subparagraph (A). The calculation of depletable oil quantity is modified, increasing the threshold from 1,000 barrels to 2,000 barrels. These amendments apply to taxable years beginning after December 31, 2026.

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Protecting America’s Small Oil and Gas Producers and Rural Jobs Act

Q: What does Preamble of Protecting America’s Small Oil and Gas Producers and Rural Jobs Act do?

This bill proposes to amend the Internal Revenue Code of 1986. The proposed amendment concerns percentage depletion rules. The rules being modified relate to oil and gas wells.

Last updated: 3/20/2026 · Introduced: 3/20/2026

Author: Tracey Mann (R-KS)

TL;DR (AI)

The bill adjusts percentage depletion rates for oil and gas producers, increasing the rate based on crude oil prices exceeding $70, with future adjustments tied to the Producer Price Index.
It raises the threshold for calculating depletable oil quantity from 1,000 barrels to 2,000 barrels.
The changes to percentage depletion rules apply to taxable years beginning after December 31, 2026.

119th Congressin committeeOfficial page

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Includes provisions on preamble, short title., and 1 more.

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