IDAPA 35.01.08.030 — NET VALUE OF ORE TO BE USED AS MEASURE OF TAX -- HOW DETERMINED (RULE 030)

Section 47-1202, Idaho Code
01.
Election. The taxpayer may elect to use one (1) of the methods prescribed in Section 47-1202,
Idaho Code, for the measurement of the mine license tax. This election must be made in writing and attached to the
first mine license tax return filed. If no timely written election is made, the taxpayer shall be presumed to have elected
to compute the mine license tax in accordance with the method described in Section 47-1202(a), Idaho Code. Once an
election is made, the taxpayer may not change the method of computing their tax unless they receive written
permission from the Tax Commission prior to the due date of the return.
(7-1-24)
a.
Taxpayers whose only taxable mining activity is receiving royalties must determine their mine
license tax liability by use of the method described in Section 47-1202(a), Idaho Code.
(7-1-24)
b.
Taxpayers whose mining activity includes both the receiving of royalties and the extracting of ores
must separately determine that portion of their mine license tax liability arising from the royalty received by using the
method described in Section 47-1202(a), Idaho Code. The portion of their mine license tax liability arising from their
extraction of ores may use either method for which a proper election was made. The separate determination may not
be netted together or offset against each other.
(7-1-24)
02.
Method Under Section 47-1202(a). For taxpayers receiving royalties, gross royalties shall be
reduced by the deduction for depletion expense on the royalty that was allowed in the taxpayer's federal income tax
return.
(7-1-24)
03.
Method Under Section 47-1202(b). In addition to requirements under Section 47-1202(b), the net
value of ores mined shall include the computations in Subsections 030.03.a. and 030.03.b.
(7-1-24)
a.
The value used under 47-1202(b) shall apply regardless of whether the ore is extracted from public,
tribal, or private land. If the taxpayer is mining properties for which a royalty must be paid, the taxpayer must attach
to the mine license tax return a copy of the value determination made by the U.S. Department of the Interior.(7-1-24)
b.
The taxpayer shall also deduct a portion of the depletion expense attributable to the property that
was allowed as a deduction in the taxpayer's federal income tax return for the same taxable year. The deductible
portion shall be determined by multiplying the depletion expense allowed on the federal income tax return by the
ratio of the gross value of ores for mine license tax purposes to the gross value of ores for federal percentage
depletion purposes. For purposes of this computation, all references to gross value and depletion expense shall be
limited to those arising from mining conducted in Idaho.
(7-1-24)