10057: 1065 - Depletion

Enter depletion amounts (except for oil and gas depletion) on line 17 of the DED screen. Drake Tax does not calculate these depletion amounts – you must calculate depletion separately before making an entry.

Timber depletion

Use Form T to determine timber depletion. Enter the final amount on the DED screen, line 17. Attach the completed form to the return as a PDF.

Oil and gas depletion

The partnership cannot deduct depletion on oil and gas wells. Each partner must determine the allowable amount to report on the partner's return. See the 1065 Instructions for Schedule K-1, box 20, "Depletion information–oil and gas (code T)," for the oil and gas depletion information that must be supplied to the partners by the partnership. You can use the DEPL screen for oil and gas depletion. This will generate Wks DEPL in the view mode showing the totals. In each of the K-1 sets, you will see K-1 DEPL showing that partners allocable amount.

Additional entry fields for oil and gas depletion information are:

• Screen K1P- 20 Other information, code T - Depletion information - oil and gas (for a K1P received by the partnership).
• Screen K > Other Information Cont'd tab > field 20T - Information for depletion - oil & gas (adjusts amounts carried from K1P screen, field 20, code T). You can also use the SA link to make special allocations for partners in this location. 
• Basis Wks tab, field 8b Oil and gas depletion.

In a 1040 return for a partner, use screen DEPL to make entries. See Related Links below for more information about entry in the 1040 package. 

Consult IRS Publication 535 Business Expenses for more information on reporting oil and gas depletion.