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The Application Of Depletion To Geothermal Resources, Stephen A. Million

University of Michigan Journal of Law Reform

The energy crisis and the increasing costs of conventional sources of energy have created increased interest in geothermal resources as an alternative energy source. One impediment to the development of geothermal resources is the uncertainty of their status under federal tax law. This note analyzes the application of the depletion provisions of the Internal Revenue Code of 1954 to geothermal resources. Consideration is given to whether geothermal resources are exhaustible, whether they can or should be viewed as heat, and whether heat is a natural deposit or a mineral. Since geothermal resources exist in several forms, and since the depletion …