foreign oil and gas loss
(4) Recapture of foreign oil and gas losses by recharacterizing later combined foreign oil and gas income (A) In general The combined foreign oil and gas income of a taxpayer for a taxable year (determined without regard to this paragraph) shall be reduced— (i) first by the amount determined under subparagraph (B), and (ii) then by the amount determined under subparagraph (C). The aggregate amount of such reductions shall be treated as income (from sources without the United States) which is not combined foreign oil and gas income. (B) Reduction for pre-2009 foreign oil extraction losses The reduction under this paragraph shall be equal to the lesser of— (i) the foreign oil and gas extraction income of the taxpayer for the taxable year (determined without regard to this paragraph), or (ii) the excess of— (I) the aggregate amount of foreign oil extraction losses for preceding taxable years beginning after December 31, 1982 , and before January 1, 2009 , over (II) so much of such aggregate amount as was recharacterized under this paragraph (as in effect before and after the date of the enactment of the Energy Improvement and Extension Act of 2008) for preceding taxable years beginning after December 31, 1982 . (C) Reduction for post-2008 foreign oil and gas losses The reduction under this paragraph shall be equal to the lesser of— (i) the combined foreign oil and gas income of the taxpayer for the taxable year (determined without regard to this paragraph), reduced by an amount equal to the reduction under subparagraph (A) for the taxable year, or (ii) the excess of— (I) the aggregate amount of foreign oil and gas losses for preceding taxable years beginning after December 31, 2008 , over (II) so much of such aggregate amount as was recharacterized under this paragraph for preceding taxable years beginning after December 31, 2008 . (D) Foreign oil and gas loss defined (i) In general For purposes of this paragraph, the term “foreign oil and gas loss” means the amount by which— (I) the gross income for the taxable year from sources without the United States and its possessions (whether or not the taxpayer chooses the benefits of this subpart for such taxable year) taken into account in determining the combined foreign oil and gas income for such year, is exceeded by (II) the sum of the deductions properly apportioned or allocated thereto. (ii) Net operating loss deduction not taken into account For purposes of clause (i), the net operating loss deduction allowable for the taxable year under section 172(a) shall not be taken into account. (iii) Expropriation and casualty losses not taken into account For purposes of clause (i), there shall not be taken into account— (I) any foreign expropriation loss (as defined in section 172(h) (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990)) for the taxable year, or (II) any loss for the taxable year which arises from fire, storm, shipwreck, or other casualty, or from theft, to the extent such loss is not compensated for by insurance or otherwise. (iv) Foreign oil extraction loss For purposes of subparagraph (B)(ii)(I), foreign oil extraction losses shall be determined under this paragraph as in effect on the day before the date of the enactment of the Energy Improvement and Extension Act of 2008.