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INSTRUCTIONS FOR SCHEDULE K-39
GENERAL INFORMATION LINE 6 – Enter the total of lines 4 and 5.
LINE 7 – The amount of credit allowed is 50% of the total costs
K.S.A. 79-32,207 provides for an income tax credit for taxpayers incurred this tax year.
who make expenditures during the tax year to plug an abandoned
oil or gas well on their land in accordance with the rules and LINE 8 – Multiply line 6 by line 7. This is the amount of plugging
regulations of the Kansas Corporation Commission (KCC). The expenditures available for credit this tax year.
credit is 50% of expenditures made during the tax year. If the credit PART C – COMPUTATION OF THIS YEAR'S CREDIT
exceeds the tax liability for the taxable year the expenditures are
made, any unused credit may be carried forward until used. The LINE 9 – Enter any carry forward from line 14 of your prior year’s
total amount of credits taken by all taxpayers (including any carry Schedule K-39.
over) may not exceed $250,000 in any fiscal year. LINE 10 – Enter the amount of credit denied from the prior year’s
For tax year 2013, and all tax years thereafter, new credits shall Schedule K-39 because the fiscal year credit limit had been
be available to only corporations that are subject to the Kansas reached.
corporate income tax (i.e., C corporations). New credits are not – Add lines 8, 9, and 10 and enter the result. This is your
LINE 11
available to individuals, partnerships, S corporations, limited total credit available this tax year.
liability companies, and other pass-through entities.
LINE 12 – Enter amount of your Kansas tax liability after all credits
Carry Forward of Unused Credits: If this credit was earned prior other than the credit for plugging an abandoned well.
to tax year 2013 and a carry forward credit remains available
to a taxpayer, that taxpayer may continue to claim that credit. LINE 13 – Enter the lesser of lines 11 or 12. Enter this amount on
However, that carry forward credit shall be subject to limitations the appropriate line of Form K-40, Form K-41, or Form K-120.
and requirements in place at the time the credit was earned. PART D – COMPUTATION OF CREDIT CARRY FORWARD
An abandoned oil or gas well is any well: 1) that the KCC
(Kansas Corporation Commission) has the authority to plug, LINE 14 – Subtract line 13 from line 11. This is the amount of credit
replug, or repair because such well is polluting or is likely to pollute you will have available to enter on line 9 of your next year’s
any usable water strata or supply, or causing the loss of usable Schedule K-39.
water; 2) on which drilling began prior to January 1, 1970; and 3) IMPORTANT: Do not send enclosures with this schedule.
that is located on land owned by the taxpayer claiming this credit. Retain copies of the following documents with your tax
Fiscal Year Credit Limitation. Qualifying taxpayers will receive records as the Kansas Department of Revenue reserves
the credit on a “first come, first serve” basis. The credit will be the right to request them as necessary to verify your tax credit.
denied after the statutory fiscal year credit limit of $250,000 • KCC Form CP-4.
has been reached. However, the amount of credit denied for
this reason may be entered on line 10 of the subsequent year’s • An itemized list of expenses with copies of invoices for
Schedule K-39. plugging costs and the KCC invoice indicating that the
Commission has verified the plugging. List the expenses of
SPECIFIC LINE INSTRUCTIONS each well separately.
• If applicable, the Kansas Department of Revenue letter of
IMPORTANT: If you incurred expenses to plug more than denied credit for line 10.
one qualifying abandoned oil or gas well this tax year as
certified by the KCC, retain a schedule for your records TAXPAYER ASSISTANCE
showing the information in Part A for each well as it may be For information about plugging an abandoned oil or gas well or
requested at a later date. your certification, contact the KCC:
Begin by completing the information at the top of the schedule. Kansas Corporation Commission
Conservation Division
PART A – ABANDONED WELL INFORMATION 266 N Main St, Ste 220
Wichita, KS 67202-1513
LINE 1 – Enter the API (American Petroleum Institute) number and
Phone: 316-337-6200
physical location of the abandoned well. Website: kcc.ks. gov/conservation
LINE 2 – Check one of the boxes. Only wells located on land
owned by the taxpayer claiming the credit qualify for the credit. For assistance in completing this schedule contact the Kansas
LINE 3 – Enter date drilling of this well began (only wells on which Department of Revenue:
drilling began prior to January 1, 1970 qualify for the credit). Taxpayer Assistance Center
Scott Office Building
PART B – PLUGGING COSTS (C Corporations only) 120 SE 10th Ave
PO Box 750260
LINE 4 – Enter the KCC plugging fee for the abandoned well. Topeka KS 66699-0260
Enclose a copy of KCC plugging invoice, even if the fee was
waived by KCC. Phone: 785-368-8222
LINE 5 – Enter the total of other expenses incurred this tax year Fax: 785-291-3614
to plug the abandoned well. If you plugged more than one Additional copies of this credit schedule and other tax forms are
qualifying well, enter the total for all qualifying wells. available from our website at: ksrevenue.org
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