Expenditures, deductible for income tax purposes, incurred by an operator for labor, fuel, repairs, hauling, and supplies used in drilling and completing a well for production.

One of the tax benefits of oil and gas investments is the ability to deduct intangible drilling costs, or IDCs. IDCs are expenses connected with drilling and preparing wells for production. Included are such items as wages, fuel, repairs, hauling charges and supplies. Initially, as much as three-fourths of an investment can go to pay for these intangibles, allowing a large deduction early into the investment