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TITLE 26-INTERNAL REVENUE CODE REFUND OR CREDIT OF OVERPAYMENTS; LIMITATIONS; INTEREST Section 36(b) of Pub. L. 85-866 provided for the filing of a claim within 6 months of Sept. 2, 1958, and for the refund or credit of any overpayment, without interest, if such refund or credit, resulting from the addition of subsec. (d) of this section, was prevented on Sept. 2, 1958, or within 6 months thereof, by the operation of any law or rule of law other than certain specified sections of the Internal Revenue Codes of 1939 and 1954. ELECTION FOR CLAY AND SHALE USED IN MANUFACTURE OF CLAY PRODUCTS Pub. L. 87-312, Sept. 26, 1961, 75 Stat. 674, provided for the election of, and procedure for, a differing rate of depletion for clay and shale used in the manufac- ture of clay products, such election to be effective for all taxable years beginning before Jan. 1, 1961, in re- spect of which the assessment of a deficiency, a refund or credit of overpayment, or the commencement of a suit for recovery is not prevented on Sept. 26, 1961, by operation of any law or rule of law, and also effective for any taxable year beginning before Jan. 1961, in re- spect of which an assessment of a deficiency has been made but not collected on or before Sept. 26, 1961. ELECTION FOR QUARTZITE AND CLAY USED IN PRODUCTION OF REFRACTORY PRODUCTS Pub. L. 87-321, § 2, Sept. 26, 1961, 75 Stat. 683, pro- vided for an election of, and procedures for, a differing rate of depletion for quartzite and clay used in produc- tion of refractory products, such election to be effec- tive on and after Jan. 1, 1951, for all taxable years be- ginning before Jan. 1, 1961, in respect of which the as- sessment of a deficiency, the refund or credit of an overpayment, or the commencement of a suit for re- covery is not prevented on Sept. 26, 1961, by the oper- ation of any law or rule of law, and also effective on and after Jan. 1, 1951, for any taxable year beginning before Jan. 1, 1961, in respect of which an assessment of a deficiency has been made but not collected on or before Sept. 26, 1961. CROSS REFERENCES Allowance of deduction for depletion, see section 611 of this title. Percentage depletion inapplicable to certain owners of coal or iron ore, see section 631 of this title. Sale of oil and gas properties, surtax on sale, see sec- tion 632 of this title. SECTION REFEuRE TO IN OTHER SECTIONS This section is referred to in sections 163, 381. 611, 613A, 614, 617, 631, 636, 901, 903, 1082, 4940 of this title. § 613A. Limitations on percentage depletion in case of oil and gas wells (a) General rule Except as otherwise provided in this section, the allowance for depletion under section 611 with respect to any oil or gas well shall be com- puted without regard to section 613. (b) Exemption for certain domestic gas wells (1) In general The allowance for depletion under section 611 shall be computed in accordance with sec- tion 613 with respect to- (A) regulated natural gas, (B) natural gas sold under a fixed con- tract, and (C) any geothermal deposit in the United States or in a possession of the United States which is determined to be a gas well, and 22 percent shall be deemed to be speci- fied in subsection (b) of section 613 for pur- poses of subsection (a) of that section. (2) Definitions For purposes of this subsection- (A) Natural gas sold under a fixed contract The term "natural gas sold under a fixed contract" means domestic natural gas sold by the producer under a contract, in effect on February 1, 1975, and at all times there- after before such sale, under which the price for such gas cannot be adjusted to re- flect to any extejit the increase in liabilities of the seller for tax under this chapter by reason of the repeal of percentage depletion for gas. Price increases after February 1, 1975, shall be presumed to take increases In tax liabilities into account unless the tax- payer demonstrates to the contrary by clear and convincing evidence. (B) Regulated natural gas The term "regulated natural gas" means domestic natural gas produced and sold by the producer, before July 1, 1976, subject to the jurisdiction of the Federal Power Com- mission, the price for which has not been adjusted to reflect to any extent the in- crease in liability of the seller for tax under this chapter by reason of the repeal of per- centage depletion for gas. Price increases after February 1, 1975, shall be presumed to take increases in tax liabilities into account unless the taxpayer demonstrates the con- trary by clear and convincing evidence. (c) Exemption for independent producers and royalty owners (1) In general Except as provided in subsection (d), the allowance for depletion under section 611 shall be computed in accordance with section 613 with respect to- (A) so much of the taxpayer's average daily production of domestic crude oil as does not exceed the taxpayer's depletable oil quantity; and (B) so much of the taxpayer's average daily production of domestic natural gas as does not exceed the taxpayer's depletable natural gas quantity; and the applicable percentage (determined in accordance with the table contained in para- graph (5)) shall be deemed to be specified in subsection (b) of section 613 for purposes of subsection (a) of that section. (2) Average daily production For purposes of paragraph (1)- (A) the taxpayer's average daily produc- tion of domestic crude oil or natural gas for any taxable year, shall be determined by di- viding his aggregate production of domestic crude oil or natural gas, as the case may be, during the taxable year by the number of days in such taxable year, and (B) in the case of a taxpayer holding a partial interest in the production from any property (including an interest held in a partnership) such taxpayer's production shall be considered to be that amount of such production determined by multiplying § 613A Page 444