"She recently handled the tax issues associated with a major oil and gas divestiture. Both of these events I described were smooth, seamless, and without problems. Karen is very competent and professional at what she does, and for a very reasonable price."
Karen S. Malone, P.C. has a broad, extensive background in accounting and taxation for the oil and gas industry, with its origin occurring even before the firm was founded in 1987. Karen S. Malone, CPA was employed from 1978-1982 by a local Dallas CPA firm that represented both the largest independent oil and gas producer in the nation and the largest in the State of Texas.
From 1982-1987, Karen was the Controller for an independent oil and gas exploration and development organization, responsible for all accounting and tax functions. This entity regularly acquired Texas leasehold interests and participated in the drilling of wells with a high success rate. Periodic sales of undeveloped & developed, non-producing & producing properties added to the company’s profitability. These two experiences provided Karen with a solid base for serving clients in the oil and gas industry, a base that has expanded in her practice.
- Design and maintain accounting systems for oil & gas revenue and expenses, including identification of separate properties for independent oil and gas producers
- Track revenue by purchaser and reconcile to year end Forms 1099
- Scrutinize operator joint interest billings for discrepancies
- Preparation of Texas margin tax (franchise tax), optimizing rules unique to the industry
- Analyze benefits of deducting or capitalizing intangible drilling costs
- Take full advantage of depreciation and expensing options for oil & gas equipment
- Maximize depletion deductions by comparing cost method to statutory method, making the best use of the 65% of taxable income limitation & carryover depletion
- Ascertain oil & gas transactions’ impact on alternative minimum tax computation
- Review choice of entity considerations, including active vs. passive participation criteria
- Analyze impact of federal and state income tax on sale of oil & gas properties, both producing and non-producing