Anorthosite.2
Asbestos.
Bauxite.
Beryl.3
Celestite.
Chromite.
Corundum.
Fluorspar.
Graphite.
Ilmenite.
Kyanite.
Mica.
Olivine.
Quartz crystals (radio grade).
Rutile.
Block Steatite talc.
Zircon.
Ores of the following metals-
Antimony.
Beryllium.
Bismuth.
Cadmium.
Cobalt.
Columbium.
Lead
Lithium.
Manganese.
Mercury.
Nickel.
Platinum.
latinum group metals.
Tantalum.
Thorium.
Tin.
Titanium.
Tungsten.
Vanadium.
Zinc.
Aplite.
Barite.
Bauxite.
Beryl.
Borax.
Calcium carbonates.
Clay, refractory and fire.
Diatomaceous earth.
Dolomite.
Fedlspar.
Flake Graphite.
(5) of section 613(b)): For example, gypsum, novaculite, natural mineral pigments, quartz sand and quartz pebbles, graphite and kyanite (if section 613(b)(2)(B) does not apply), and anorthosite to the extent that alumina and aluminum compounds are not extracted therefrom. The 15-percent rate applies to such all other minerals when used or sold for use by the mine owner or operator for purposes other than as rip rap, ballast, road material, rubble, concrete aggregates, or for similar purposes. When any such minerals are used or sold for use by the mine owner or operator as rip rap, ballast, road material, rubble, concrete aggregates, or for similar purposes, the 5-percent rate applies except that, when sold for such use by the mine owner or operator on a bid in direct competition with a bona fide bid to sell a mineral listed in section 613(b)(3), the 15-percent rate applies. For example, limestone sold on a bid in direct competition with a bona fide bid to sell rock asphalt for road building purposes may be entitled to a 15-percent rate. In every case the taxpayer must establish to the satisfaction of the district director that there was a bona fide bid to sell a mineral listed under section 613(b)(3) by a person other than the taxpayer, and that the mineral sold by the taxpayer was sold on a bid in direct competition with such bona fide bid to sell such other material.
Fluorspar
Fullers earth.
Barnet.
Gilsonite.
Granite
Lepidolite.
Limestone.
Magnesite.
Magnesium carbonates
Marble.
Mica
Phosphate rock.
Potash.
Quartzite.
Slate.
Soapstone.
Spodumene.
Stone (dimension or7 ornamental).
Talc (including pyrophyllite).
Thernardite.
Tripoli.
Trona.
All other minerals
Example. A leases coal-bearing lands to B on condition that B will annually pay a royalty of 25 cents a ton on coal mined and sold by B. During the year 1956, B mines and sells f.o.b. mine 100,000 tons of coal for $600,000. In computing gross income from the property for the year 1956, B will exclude $25,000 (100,000 tons * $0.25) in computing his allowable percentage depletion deduction. B's allowable percentage depletion deduction (without reference to the limitation based on taxable income from the property) for the year 1956 will be $57,500 (($600,000-$25,000) * 10 percent).
Example. If B in example 2 in paragraph (b)(4) of § 1.612-3 , elects to deduct in 1956 the $10,000 paid to A in that year, he must exclude the same amount from gross income from the property in 1956; however, if B elects to defer the deduction until 1957 when he mined and sold the mineral, he must exclude the $10,000 from gross income from the property in 1957.
26 C.F.R. §1.613-2