Publication 535 - Business Expenses - Section 197 Intangibles

Publication 535

Previous Page | Table of Contents | Index | Next Page Right Arrow

taxmap/pubs/p535-043.htm#en_us_publink1000208962

Generally, you may amortize the capitalized costs of "section 197 intangibles" (defined later) ratably over a 15-year period. You must amortize these costs if you hold the section 197 intangibles in connection with your trade or business or in an activity engaged in for the production of income.

You may not be able to amortize section 197 intangibles acquired in a transaction that did not result in a significant change in ownership or use. See Anti-Churning Rules, later.

Your amortization deduction each year is the applicable part of the intangible's adjusted basis (for purposes of determining gain), figured by amortizing it ratably over 15 years (180 months). The 15-year period begins with the later of:

The month the intangible is acquired, or
The month the trade or business or activity engaged in for the production of income begins.

You cannot deduct amortization for the month you dispose of the intangible.

If you pay or incur an amount that increases the basis of an amortizable section 197 intangible after the 15-year period begins, amortize it over the remainder of the 15-year period beginning with the month the basis increase occurs.

You are not allowed any other depreciation or amortization deduction for an amortizable section 197 intangible.

taxmap/pubs/p535-043.htm#en_us_publink1000208964

The amortization period for any section 197 intangible leased under a lease agreement entered into after March 12, 2004, to a tax-exempt organization, governmental unit, or foreign person or entity (other than a partnership), shall not be less than 125 percent of the lease term.

taxmap/pubs/p535-043.htm#en_us_publink1000208965

The rules for section 197 intangibles do not apply to any amount that is included in determining the cost of property that is not a section 197 intangible. For example, if the cost of computer software is not separately stated from the cost of hardware or other tangible property and you consistently treat it as part of the cost of the hardware or other tangible property, these rules do not apply. Similarly, none of the cost of acquiring real property held for the production of rental income is considered the cost of goodwill, going concern value, or any other section 197 intangible.

taxmap/pubs/p535-043.htm#en_us_publink1000208966

Section 197 Intangibles

The following assets are section 197 intangibles and must be amortized over 180 months:

Goodwill;
Going concern value;
Workforce in place;
Business books and records, operating systems, or any other information base, including lists or other information concerning current or prospective customers;
A patent, copyright, formula, process, design, pattern, know-how, format, or similar item;
A customer-based intangible;
A supplier-based intangible;
Any item similar to items (3) through (7);
A license, permit, or other right granted by a governmental unit or agency (including issuances and renewals);
A covenant not to compete entered into in connection with the acquisition of an interest in a trade or business;
Any franchise, trademark, or trade name; and
A contract for the use of, or a term interest in, any item in this list.

You cannot amortize any of the intangibles listed in items (1) through (8) that you created rather than acquired unless you created them in acquiring assets that make up a trade or business or a substantial part of a trade or business.

taxmap/pubs/p535-043.htm#en_us_publink1000208968

This is the value of a trade or business based on expected continued customer patronage due to its name, reputation, or any other factor.

taxmap/pubs/p535-043.htm#en_us_publink1000208969

This is the additional value of a trade or business that attaches to property because the property is an integral part of an ongoing business activity. It includes value based on the ability of a business to continue to function and generate income even though there is a change in ownership (but does not include any other section 197 intangible). It also includes value based on the immediate use or availability of an acquired trade or business, such as the use of earnings during any period in which the business would not otherwise be available or operational.

taxmap/pubs/p535-043.htm#en_us_publink1000208970

This includes the composition of a workforce (for example, its experience, education, or training). It also includes the terms and conditions of employment, whether contractual or otherwise, and any other value placed on employees or any of their attributes.

For example, you must amortize the part of the purchase price of a business that is for the existence of a highly skilled workforce. Also, you must amortize the cost of acquiring an existing employment contract or relationship with employees or consultants.

taxmap/pubs/p535-043.htm#en_us_publink1000208971

This includes the intangible value of technical manuals, training manuals or programs, data files, and accounting or inventory control systems. It also includes the cost of customer lists, subscription lists, insurance expirations, patient or client files, and lists of newspaper, magazine, radio, and television advertisers.

taxmap/pubs/p535-043.htm#en_us_publink1000208972

This includes package design, computer software, and any interest in a film, sound recording, videotape, book, or other similar property, except as discussed later under Assets That Are Not Section 197 Intangibles.

taxmap/pubs/p535-043.htm#en_us_publink1000208973

This is the composition of market, market share, and any other value resulting from the future provision of goods or services because of relationships with customers in the ordinary course of business. For example, you must amortize the part of the purchase price of a business that is for the existence of the following intangibles.

A customer base.
A circulation base.
An undeveloped market or market growth.
Insurance in force.
A mortgage servicing contract.
An investment management contract.
Any other relationship with customers involving the future provision of goods or services.

Accounts receivable or other similar rights to income for goods or services provided to customers before the acquisition of a trade or business are not section 197 intangibles.

taxmap/pubs/p535-043.htm#en_us_publink1000208974

This is the value resulting from the future acquisition of goods or services used or sold by the business because of business relationships with suppliers.

For example, you must amortize the part of the purchase price of a business that is for the existence of the following intangibles.

A favorable relationship with distributors (such as favorable shelf or display space at a retail outlet).
A favorable credit rating.
A favorable supply contract.

taxmap/pubs/p535-043.htm#en_us_publink1000208975

This is any right granted by a governmental unit or an agency or instrumentality of a governmental unit. For example, you must amortize the capitalized costs of acquiring (including issuing or renewing) a liquor license, a taxicab medallion or license, or a television or radio broadcasting license.

taxmap/pubs/p535-043.htm#en_us_publink1000208976

Section 197 intangibles include a covenant not to compete (or similar arrangement) entered into in connection with the acquisition of an interest in a trade or business, or a substantial portion of a trade or business. An interest in a trade or business includes an interest in a partnership or a corporation engaged in a trade or business.

An arrangement that requires the former owner to perform services (or to provide property or the use of property) is not similar to a covenant not to compete to the extent the amount paid under the arrangement represents reasonable compensation for those services or for that property or its use.

taxmap/pubs/p535-043.htm#en_us_publink1000208977

A franchise, trademark, or trade name is a section 197 intangible. You must amortize its purchase or renewal costs, other than certain contingent payments that you can deduct currently. For information on currently deductible contingent payments, see chapter 11.

taxmap/pubs/p535-043.htm#en_us_publink1000208978

A franchise engaged in professional sports and any intangible assets acquired in connection with acquiring the franchise (including player contracts) is a section 197 intangible amortizable over a 15-year period.

taxmap/pubs/p535-043.htm#en_us_publink1000208979

Section 197 intangibles include any right under a license, contract, or other arrangement providing for the use of any section 197 intangible. It also includes any term interest in any section 197 intangible, whether the interest is outright or in trust.

taxmap/pubs/p535-043.htm#en_us_publink1000208980

Assets That Are Not Section 197 Intangibles

The following assets are not section 197 intangibles.

Any interest in a corporation, partnership, trust, or estate.
Any interest under an existing futures contract, foreign currency contract, notional principal contract, interest rate swap, or similar financial contract.
Any interest in land.
Most computer software. (See Computer software, later.)
Any of the following assets not acquired in connection with the acquisition of a trade or business or a substantial part of a trade or business.
1. An interest in a film, sound recording, video tape, book, or similar property.
2. A right to receive tangible property or services under a contract or from a governmental agency.
3. An interest in a patent or copyright.
4. Certain rights that have a fixed duration or amount. (See Rights of fixed duration or amount, later.)
An interest under either of the following.
1. An existing lease or sublease of tangible property.
2. A debt that was in existence when the interest was acquired.
A right to service residential mortgages unless the right is acquired in connection with the acquisition of a trade or business or a substantial part of a trade or business.
Certain transaction costs incurred by parties to a corporate organization or reorganization in which any part of a gain or loss is not recognized.

Intangible property that is not amortizable under the rules for section 197 intangibles can be depreciated if it meets certain requirements. You generally must use the straight line method over its useful life. For certain intangibles, the depreciation period is specified in the law and regulations. For example, the depreciation period for computer software that is not a section 197 intangible is generally 36 months.

For more information on depreciating intangible property, see Intangible Property under What Method Can You Use To Depreciate Your Property? in chapter 1 of Publication 946.

taxmap/pubs/p535-043.htm#en_us_publink1000208981

Section 197 intangibles do not include the following types of computer software.

Software that meets all the following requirements.
1. It is, or has been, readily available for purchase by the general public.
2. It is subject to a nonexclusive license.
3. It has not been substantially modified. This requirement is considered met if the cost of all modifications is not more than the greater of 25% of the price of the publicly available unmodified software or $2,000.
Software that is not acquired in connection with the acquisition of a trade or business or a substantial part of a trade or business.

taxmap/pubs/p535-043.htm#en_us_publink1000208982

Computer software includes all programs designed to cause a computer to perform a desired function. It also includes any database or similar item that is in the public domain and is incidental to the operation of qualifying software.

taxmap/pubs/p535-043.htm#en_us_publink1000208983

Section 197 intangibles do not include any right under a contract or from a governmental agency if the right is acquired in the ordinary course of a trade or business (or in an activity engaged in for the production of income) but not as part of a purchase of a trade or business and either:

Has a fixed life of less than 15 years, or
Is of a fixed amount that, except for the rules for section 197 intangibles, would be recovered under a method similar to the unit-of-production method of cost recovery.

However, this does not apply to the following intangibles.

Goodwill.
Going concern value.
A covenant not to compete.
A franchise, trademark, or trade name.
A customer-related information base, customer-based intangible, or similar item.

taxmap/pubs/p535-043.htm#en_us_publink1000208984

Safe Harbor for Creative Property Costs

If you are engaged in the trade or business of film production, you may be able to amortize the creative property costs for properties not set for production within 3 years of the first capitalized transaction. You may amortize these costs ratably over a 15-year period beginning on the first day of the second half of the tax year in which you properly write off the costs for financial accounting purposes. If, during the 15-year period, you dispose of the creative property rights, you must continue to amortize the costs over the remainder of the 15-year period.

Creative property costs include costs paid or incurred to acquire and develop screenplays, scripts, story outlines, motion picture production rights to books and plays, and other similar properties for purposes of potential future film development, production, and exploitation.

Amortize these costs using the rules of Revenue Procedure 2004-36. For more information, see Revenue Procedure 2004-36, 2004-24 I.R.B. 1063, available at
www.irs.gov/irb/2004-24_IRB/ar16.html.

A change in the treatment of creative property costs is a change in method of accounting.

taxmap/pubs/p535-043.htm#en_us_publink1000208986

Anti-churning Rules

Anti-churning rules prevent you from amortizing most section 197 intangibles if the transaction in which you acquired them did not result in a significant change in ownership or use. These rules apply to goodwill and going concern value, and to any other section 197 intangible that is not otherwise depreciable or amortizable.

Under the anti-churning rules, you cannot use 15-year amortization for the intangible if any of the following conditions apply.

You or a related person (defined later) held or used the intangible at any time from July 25, 1991, through August 10, 1993.
You acquired the intangible from a person who held it at any time during the period in (1) and, as part of the transaction, the user did not change.
You granted the right to use the intangible to a person (or a person related to that person) who held or used it at any time during the period in (1). This applies only if the transaction in which you granted the right and the transaction in which you acquired the intangible are part of a series of related transactions. See Related person, later, for more information.

taxmap/pubs/p535-043.htm#en_us_publink1000208987

The anti-churning rules do not apply in the following situations.

You acquired the intangible from a decedent and its basis was stepped up to its fair market value.
The intangible was amortizable as a section 197 intangible by the seller or transferor you acquired it from. This exception does not apply if the transaction in which you acquired the intangible and the transaction in which the seller or transferor acquired it are part of a series of related transactions.
The gain-recognition exception, discussed later, applies.

taxmap/pubs/p535-043.htm#en_us_publink1000208988

For purposes of the anti-churning rules, the following are related persons.

An individual and his or her brothers, sisters, half-brothers, half-sisters, spouse, ancestors (parents, grandparents, etc.), and lineal descendants (children, grandchildren, etc.).
A corporation and an individual who owns, directly or indirectly, more than 20% of the value of the corporation's outstanding stock.
Two corporations that are members of the same controlled group as defined in section 1563(a) of the Internal Revenue Code, except that "more than 20%" is substituted for "at least 80%" in that definition and the determination is made without regard to subsections (a)(4) and (e)(3)(C) of section 1563. (For an exception, see section 1.197-2(h)(6)(iv) of the regulations.)
A trust fiduciary and a corporation if more than 20% of the value of the corporation's outstanding stock is owned, directly or indirectly, by or for the trust or grantor of the trust.
The grantor and fiduciary, and the fiduciary and beneficiary, of any trust.
The fiduciaries of two different trusts, and the fiduciaries and beneficiaries of two different trusts, if the same person is the grantor of both trusts.
The executor and beneficiary of an estate.
A tax-exempt educational or charitable organization and a person who directly or indirectly controls the organization (or whose family members control it).
A corporation and a partnership if the same persons own more than 20% of the value of the outstanding stock of the corporation and more than 20% of the capital or profits interest in the partnership.
Two S corporations, and an S corporation and a regular corporation, if the same persons own more than 20% of the value of the outstanding stock of each corporation.
Two partnerships if the same persons own, directly or indirectly, more than 20% of the capital or profits interests in both partnerships.
A partnership and a person who owns, directly or indirectly, more than 20% of the capital or profits interests in the partnership.
Two persons who are engaged in trades or businesses under common control (as described in section 41(f)(1) of the Internal Revenue Code).

taxmap/pubs/p535-043.htm#en_us_publink1000208989

Persons are treated as related if the relationship existed at the following time.

In the case of a single transaction, immediately before or immediately after the transaction in which the intangible was acquired.
In the case of a series of related transactions (or a series of transactions that comprise a qualified stock purchase under section 338(d)(3) of the Internal Revenue Code), immediately before the earliest transaction or immediately after the last transaction.

taxmap/pubs/p535-043.htm#en_us_publink1000208990

In determining whether an individual directly or indirectly owns any of the outstanding stock of a corporation, the following rules apply.

taxmap/pubs/p535-043.htm#en_us_publink1000208991

Stock directly or indirectly owned by or for a corporation, partnership, estate, or trust is considered owned proportionately by or for its shareholders, partners, or beneficiaries.

taxmap/pubs/p535-043.htm#en_us_publink1000208992

An individual is considered to own the stock directly or indirectly owned by or for his or her family. Family includes only brothers and sisters, half-brothers and half-sisters, spouse, ancestors, and lineal descendants.

taxmap/pubs/p535-043.htm#en_us_publink1000208993

An individual owning (other than by applying Rule 2) any stock in a corporation is considered to own the stock directly or indirectly owned by or for his or her partner.

taxmap/pubs/p535-043.htm#en_us_publink1000208994

For purposes of applying Rule 1, 2, or 3, treat stock constructively owned by a person under Rule 1 as actually owned by that person. Do not treat stock constructively owned by an individual under Rule 2 or 3 as owned by the individual for reapplying Rule 2 or 3 to make another person the constructive owner of the stock.

taxmap/pubs/p535-043.htm#en_us_publink1000208995

This exception to the anti-churning rules applies if the person you acquired the intangible from (the transferor) meets both of the following requirements.

That person would not be related to you (as described under Related person, earlier) if the 20% test for ownership of stock and partnership interests were replaced by a 50% test.
That person chose to recognize gain on the disposition of the intangible and pay income tax on the gain at the highest tax rate. See chapter 2 in Publication 544 for information on making this choice.

If this exception applies, the anti-churning rules apply only to the amount of your adjusted basis in the intangible that is more than the gain recognized by the transferor.

taxmap/pubs/p535-043.htm#en_us_publink1000208996

If the person you acquired the intangible from chooses to recognize gain under the rules for this exception, that person must notify you in writing by the due date of the return on which the choice is made.

taxmap/pubs/p535-043.htm#en_us_publink1000208997

You cannot amortize any section 197 intangible acquired in a transaction for which the principal purpose was either of the following.

To avoid the requirement that the intangible be acquired after August 10, 1993.
To avoid any of the anti-churning rules.

taxmap/pubs/p535-043.htm#en_us_publink1000208998

For more information about the anti-churning rules, including additional rules for partnerships, see Regulations section 1.197-2(h).

taxmap/pubs/p535-043.htm#en_us_publink1000208999

Incorrect Amount of Amortization Deducted

If you later discover that you deducted an incorrect amount for amortization for a section 197 intangible in any year, you may be able to make a correction for that year by filing an amended return. See Amended Return, next. If you are not allowed to make the correction on an amended return, you can change your accounting method to claim the correct amortization. See Changing Your Accounting Method, later.

taxmap/pubs/p535-043.htm#en_us_publink1000209000

Amended/Corrected Tax Return

If you deducted an incorrect amount for amortization, you can file an amended return to correct the following.

A mathematical error made in any year.
A posting error made in any year.
An amortization deduction for a section 197 intangible for which you have not adopted a method of accounting.

taxmap/pubs/p535-043.htm#en_us_publink1000209001

If an amended return is allowed, you must file it by the later of the following dates.

3 years from the date you filed your original return for the year in which you did not deduct the correct amount. (A return filed early is considered filed on the due date.)
2 years from the time you paid your tax for that year.

taxmap/pubs/p535-043.htm#en_us_publink1000209002

Changing Your Accounting Method

Generally, you must get IRS approval to change your method of accounting. File Form 3115, Application for Change in Accounting Method, to request a change to a permissible method of accounting for amortization.

The following are examples of a change in method of accounting for amortization.

A change in the amortization method, period of recovery, or convention of an amortizable asset.
A change in the accounting for amortizable assets from a single asset account to a multiple asset account (pooling), or vice versa.
A change in the accounting for amortizable assets from one type of multiple asset account to a different type of multiple asset account.

Changes in amortization that are not a change in method of accounting include the following:

A change in computing amortization in the tax year in which your use of the asset changes.
An adjustment in the useful life of an amortizable asset.
Generally, the making of a late amortization election or the revocation of a timely valid amortization election.
Any change in the placed-in-service date of an amortizable asset.

See Regulations section 1.446-1(e)(2)(ii)(a) for more information and examples.

taxmap/pubs/p535-043.htm#en_us_publink1000209003

In some instances, you may be able to get automatic approval from the IRS to change your method of accounting for amortization. For a list of automatic accounting method changes, see the Instructions for Form 3115. Also see the Instructions for Form 3115 for more information on getting approval, automatic approval procedures, and a list of exceptions to the automatic approval process.

For more information, see Revenue Procedure 2006-12, as modified by Revenue Procedure 2006-37, and Revenue Procedure 2008-52, as amplified, clarified, and modified by Revenue Procedure 2009-39. See Revenue Procedure 2006-12, 2006-3 I.R.B. 310, available at
www.irs.gov/irb/2006-03_IRB/ar14.html.
See Revenue Procedure 2006-37, 2006-38 I.R.B. 499, available at
www.irs.gov/irb/2006-38_IRB/ar10.html.
See Revenue Procedure 2008-52, 2008-36 I.R.B. 587, available at
www.irs.gov/irb/2008-36_IRB/ar09.html.
See Revenue Procedure 2009-39, 2009-38 I.R.B. 371, available at
www.irs.gov/irb/2009-38_IRB/ar08.html.

Note.If you are filing an application for a change in accounting method filed on or after January 10, 2011, for a year of change ending on or after April 30, 2010, see Revenue Procedure 2011-14, 2011-4 I.R.B. 330, available at
www.irs.gov/irb/2011-04_IRB/ar08.html.

taxmap/pubs/p535-043.htm#en_us_publink1000209004

Disposition of Section 197 Intangibles

A section 197 intangible is treated as depreciable property used in your trade or business. If you held the intangible for more than 1 year, any gain on its disposition, up to the amount of allowable amortization, is ordinary income (section 1245 gain). If multiple section 197 intangibles are disposed of in a single transaction or a series of related transactions, treat all of the section 197 intangibles as if they were a single asset for purposes of determining the amount of gain that is ordinary income. Any remaining gain, or any loss, is a section 1231 gain or loss. If you held the intangible 1 year or less, any gain or loss on its disposition is an ordinary gain or loss. For more information on ordinary or capital gain or loss on business property, see chapter 3 in Publication 544.

taxmap/pubs/p535-043.htm#en_us_publink1000209005

You cannot deduct any loss on the disposition or worthlessness of a section 197 intangible that you acquired in the same transaction (or series of related transactions) as other section 197 intangibles you still have. Instead, increase the adjusted basis of each remaining amortizable section 197 intangible by a proportionate part of the nondeductible loss. Figure the increase by multiplying the nondeductible loss on the disposition of the intangible by the following fraction.

The numerator is the adjusted basis of each remaining intangible on the date of the disposition.
The denominator is the total adjusted bases of all remaining amortizable section 197 intangibles on the date of the disposition.

taxmap/pubs/p535-043.htm#en_us_publink1000209006

A covenant not to compete, or similar arrangement, is not considered disposed of or worthless before you dispose of your entire interest in the trade or business for which you entered into the covenant.

taxmap/pubs/p535-043.htm#en_us_publink1000209007

If you acquire a section 197 intangible in a nonrecognition transfer, you are treated as the transferor with respect to the part of your adjusted basis in the intangible that is not more than the transferor's adjusted basis. You amortize this part of the adjusted basis over the intangible's remaining amortization period in the hands of the transferor. Nonrecognition transfers include transfers to a corporation, partnership contributions and distributions, like-kind exchanges, and involuntary conversions.

In a like-kind exchange or involuntary conversion of a section 197 intangible, you must continue to amortize the part of your adjusted basis in the acquired intangible that is not more than your adjusted basis in the exchanged or converted intangible over the remaining amortization period of the exchanged or converted intangible. Amortize over a new 15-year period the part of your adjusted basis in the acquired intangible that is more than your adjusted basis in the exchanged or converted intangible.

taxmap/pubs/p535-043.htm#en_us_publink1000209008

Example.(p31)

You own a section 197 intangible you have amortized for 4 full years. It has a remaining unamortized basis of $30,000. You exchange the asset plus $10,000 for a like-kind section 197 intangible. The nonrecognition provisions of like-kind exchanges apply. You amortize $30,000 of the $40,000 adjusted basis of the acquired intangible over the 11 years remaining in the original 15-year amortization period for the transferred asset. You amortize the other $10,000 of adjusted basis over a new 15-year period.

Previous Page | Table of Contents | Top of Page | Index | Next Page Right Arrow

Section 197 Intangibles(p28)

Tax-exempt use property subject to a lease.(p28)

Cost attributable to other property.(p28)

Section 197 Intangibles Defined(p28)

Goodwill.(p29)

Going concern value.(p29)

Workforce in place, etc.(p29)

Business books and records, etc.(p29)

Patents, copyrights, etc.(p29)

Customer-based intangible.(p29)

Supplier-based intangible.(p29)

Government-granted license, permit, etc.(p29)

Covenant not to compete.(p29)

Franchise, trademark, or trade name.(p29)

Contract for the use of, or a term interest in, a section 197 intangible.(p29)

Assets That Are Not
Section 197 Intangibles(p29)

Computer software.(p29)

Rights of fixed duration or amount.(p30)

Safe Harbor for Creative Property Costs(p30)

Anti-Churning Rules(p30)

Exceptions.(p30)

Related person.(p30)

Gain-recognition exception.(p30)

Anti-abuse rule.(p31)

More information.(p31)

Incorrect Amount of
Amortization Deducted(p31)

Amended Return(p31)

When to file.(p31)

Changing Your
Accounting Method(p31)

Automatic approval.(p31)

Disposition of
Section 197 Intangibles(p31)

Nondeductible loss.(p31)

Covenant not to compete.(p31)

Nonrecognition transfers.(p31)

Example.(p31)

Section 197 Intangibles(p28)

Tax-exempt use property subject to a lease.(p28)

Cost attributable to other property.(p28)

Section 197 Intangibles Defined(p28)

Goodwill.(p29)

Going concern value.(p29)

Workforce in place, etc.(p29)

Business books and records, etc.(p29)

Patents, copyrights, etc.(p29)

Customer-based intangible.(p29)

Supplier-based intangible.(p29)

Government-granted license, permit, etc.(p29)

Covenant not to compete.(p29)

Franchise, trademark, or trade name.(p29)

Contract for the use of, or a term interest in, a section 197 intangible.(p29)

Assets That Are Not Section 197 Intangibles(p29)

Computer software.(p29)

Rights of fixed duration or amount.(p30)

Safe Harbor for Creative Property Costs(p30)

Anti-Churning Rules(p30)

Exceptions.(p30)

Related person.(p30)

Gain-recognition exception.(p30)

Anti-abuse rule.(p31)

More information.(p31)

Incorrect Amount of Amortization Deducted(p31)

Amended Return(p31)

When to file.(p31)

Changing Your Accounting Method(p31)

Automatic approval.(p31)

Disposition of Section 197 Intangibles(p31)

Nondeductible loss.(p31)

Covenant not to compete.(p31)

Nonrecognition transfers.(p31)

Example.(p31)

Assets That Are Not
Section 197 Intangibles(p29)

Incorrect Amount of
Amortization Deducted(p31)

Changing Your
Accounting Method(p31)

Disposition of
Section 197 Intangibles(p31)