Ohio Production Exemption Only Applies to Certain Fracking Equipment

Monday, January 22nd, 2018

Oil rig.

The Ohio Board of Tax Appeals recently ruled that the oil production exemption only applies to hydraulic fracturing (fracking) equipment that injects fracking fluid into a well. Fracking involves pumping fracking fluid into a well at high pressure to prepare for oil drilling. To prepare for fracking, various pieces of equipment are used to prepare and transport the fracking fluid.

Ohio exempts equipment for direct use in the production of crude oil and natural gas. In the context of oil production, only equipment used in actual drilling meets the "direct use" requirement. The ruling determined that the exemption applied to equipment used to pump fracking fluid into a well, but it did not apply to equipment used to prepare and transport fracking fluid to the pumps.

https://www.ttrus.com/Fracking Equipment

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TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

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