Common use of Allocations for Federal Income Tax Purposes Clause in Contracts

Allocations for Federal Income Tax Purposes. With respect to the various allocations of Partnership Revenues, gain, loss, deduction and credit for federal income tax purposes, it is hereby agreed as follows: (i) To the extent permitted by law, all charges, deductions and losses shall be allocated for federal income tax purposes in the same manner as the costs in respect of which such charges, deductions and losses are charged to the General Partner and Unit Holders, respectively. The General Partner and Unit Holders bearing the costs shall be entitled to the deductions (including, without limitation, cost recovery allowances, depreciation and cost depletion) and credits that are attributable to such costs. (ii) The Partnership shall allocate to the General Partner and each Unit Holder its portion of the adjusted basis in each depletable Partnership Property as required by Section 613A(c)(7)(D) of the Code based upon the interest of the General Partner or such Unit Holder in the capital of the Partnership as of the time of the acquisition of such Partnership Property. To the extent permitted by the Code, such allocation shall be based upon the General Partner's or said Unit Holder's interest (x) in the Partnership capital used to acquire the property, or (y) in the adjusted basis of the property if it is contributed to the Partnership. If such allocation of basis is not permitted under the Code, then basis will be allocated in the permissible manner which the General Partner deems will most closely achieve the result intended above. (iii) Partnership Revenues shall be allocated for federal income tax purposes in the same manner as they are allocated to the respective accounts of the General Partner and Unit Holders pursuant to Sections 5.2, 5.3 and 5.4 above. (iv) Depreciation or cost recovery allowance recapture and recapture of intangible drilling and development costs, if any, due as a result of sales or dispositions of assets shall be allocated in the same proportion that the depreciation, cost recovery allowances or intangible drilling and development costs being restored or recaptured were allocated.

Allocations for Federal Income Tax Purposes. With respect to the various allocations of Partnership Revenues, gain, loss, deduction and credit for federal income tax purposes, it is hereby agreed as follows: (i) To the extent permitted by law, all charges, deductions and losses shall be allocated for federal income tax purposes in the same manner as the costs in respect of which such charges, deductions and losses are charged to the General Partner and Unit Holders, respectively. The General Partner and Unit Holders bearing the costs shall be entitled to the deductions (including, without limitation, cost recovery allowances, depreciation and cost depletion) and credits that are attributable to such costs. (ii) The Partnership shall allocate to the General Partner and each Unit Holder its portion of the adjusted basis in each depletable Partnership Property as required by Section 613A(c)(7)(D613A(c) (7) (D) of the Code based upon the interest of the General Partner or such Unit Holder in the capital of the Partnership as of the time of the acquisition of such Partnership Property. To the extent permitted by the Code, such allocation shall be based upon the General Partner's or said Unit Holder's interest (x) in the Partnership capital used to acquire the property, or (y) in the adjusted basis of the property if it is contributed to the Partnership. If such allocation of basis is not permitted under the Code, then basis will be allocated in the permissible manner which the General Partner deems will most closely achieve the result intended above. (iii) Partnership Revenues shall be allocated for federal income tax purposes in the same manner as they are allocated to the respective accounts of the General Partner and Unit Holders pursuant to Sections 5.2, 5.3 and 5.4 above. (iv) Depreciation or cost recovery allowance recapture and recapture of intangible drilling and development costs, if any, due as a result of sales or dispositions of assets shall be allocated in the same proportion that the depreciation, cost recovery allowances or intangible drilling and development costs being restored or recaptured were allocated.