What is Section 197 intangibles?
In short
Purchased intangibles such as goodwill, going concern value, customer lists, covenants not to compete, franchises, trademarks and licenses are amortized for tax on a straight-line basis over 15 years, starting in the month acquired.
Key takeaways
- Most self-created intangibles aren't covered.
- The 15-year period applies regardless of the asset's actual useful life.
- Goodwill amortized for tax but not for books creates a temporary difference.
Where it's tested
REG: Property Transactions: Basis & Cost Recovery — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
Under the One Big Beautiful Bill Act, which statement about bonus depreciation is correct for qualifying property acquired after January 19, 2025?