Depletion

An accounting term describing the amortization of assets that can be physically reduced.

Investopedia Says:
Unlike depreciation and amortization, which mainly describe the deduction of expenses due to the aging of equipment and property, depletion is the actual physical reduction of natural resources by companies.

For example, coal mines, oil fields and other natural resources are depleted on company accounting statements. This reduction in the quantity of resources is meant to assist in accurately identifying the value of the asset on the balance sheet.

Related Links:
Companies make choices and assumptions in calculating depreciation, and you need to know how these affect the bottom line. Appreciating Depreciation

Accounting treatment available to companies that extract oil and gas, coal, or other minerals, usually in the form of an allowance that reduces taxable income. Oil and gas limited partnerships pass the allowance on to their limited partners, who can use it to reduce other tax liabilities.

A Deduction to account for reduced Land value due to removing minerals.
Example: The $10,000 tax deduction for depletion was allowed because coal was being removed and the land would become virtually worthless when all of the coal was gone.
Example: The land's value was reduced by depletion of its mineral resources.

Depletion may refer to:

• Depletion, an accounting concept
• Depletion region, a concept of semiconductor physics
• Depletion width, a concept of semiconductor physics
• Grain boundary depletion, a mechanism of corrosion
• Oil depletion, the declining of oil supply
• Ozone depletion, a decline in the total amount of ozone in Earth's stratosphere
• Resource depletion, exhaustion of raw materials within a region

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