A bill to amend the Internal Revenue Code of 1986 to modify the small refiner exception to the oil depletion deduction.

This bill proposes to expand a specific tax break for small oil refining companies by changing the criteria used to define them. Under current tax law, these companies can deduct a portion of their income related to oil production (known as a "depletion deduction"), provided their daily output does not exceed 50,000 barrels. This legislation would raise that limit to 75,000 barrels per day, allowing more mid-sized refineries to qualify for the tax benefit.

For the average citizen, the bill is designed to provide financial relief to independent refineries that are larger than small family operations but smaller than major global oil corporations. Proponents of such measures generally aim to lower operating costs for these domestic refiners to help maintain a competitive market, though the direct impact on consumer gas prices would likely be indirect. The bill was introduced in 2005 and referred to the Senate Committee on Finance, but it did not advance further into law during that session of Congress.