Summary In the last 10 years, many people within the oil industry and academia have been studying additional ways to recover more of the known oil in place left after reservoirs have reached their economic limit with conventional primary and secondary techniques. These ways commonly are called enhanced or tertiary methods, and early studies emphasized technical concerns-e.g., how much oil remains for tertiary recovery, incremental displacement efficiency, reservoir data, model and field performance calculations, operating procedures. special equipment required. etc. With more and more data indicating that enhanced oil recovery (EOR) processes are technically feasible, the last few years' research has turned toward determining if EOR carries the necessary economic incentives. The U.S. government has placed a key role in this matter. Two former programs of the U.S. DOE gave economic incentives for undertaking EOR projects. These were the Tertiary Incentive and Tertiary Incremental Programs. Respectively, they allowed up to $20 million recoupment of specified expenses per property through decontrolling oil prices, and gave world-market oil prices for incremental oil produced using specified tertiary techniques. Because of present decontrolled oil prices, these programs are no longer viable. However, one government program remains that may result in economic incentives for EOR projects. This is the Windfall Profit Tax Act applied to tertiary projects. In this paper. the 1981 SPE Permian Basin Enhanced Oil Recovery Symposium Technical Program Committee clarifies what EOR incentive exists in the Windfall Profit Tax Act of 1980 and how to use it. We show the relevant portions of the regulations, consolidating this information in an easy-to-use question-and-answer format for reference. The material appearing in this paper was compiled by practicing engineers as a general guideline. We accept no legal responsibility as to the accuracy or completeness of the contents. With this common ground, some questions concerning compliance should be answered. This knowledge will enable u% to take a more timely approach in beginning actual field programs. This leads directly to recovery of additional reserves available with improved technology in EOR processes. Crude Oil Windfall Profit Tax Act of 1980 Of the government programs designed to encourage tertiary recovery projects, the tertiary incentives that are a part of the Windfall Profit Tax Act will have the greatest economic incentive in the long run. Since this program is a tax incentive, it is administered by the U.S. Internal Revenue Service (IRS) and not the DOE. However, the Windfall Profit Tax Act does rely heavily on the terminology of definitions set forth in the DOE programs; thus, understanding them is important. A simple explanation of the act's tertiary incentive is that the windfall profit tax rate is reduced from 70, 60, or 50% on existing Tier 1 and 2 properties to 30% for incremental tertiary oil produced (Tier 3). The what, how, and why of doing this are much more complicated. We have tried to simplify this program for you. The answers in this paper are excerpts taken directly from IRS regulations published in the Federal Register as of Jan. 1981 and from Internal Revenue Cumulative Bulletin, 1980–3. JPT P. 445^