How is Goodwill handled for tax purposes?

A ratable deduction for the cost of certain intangible property over the period specified by law. Examples of costs that can be amortized are goodwill, agreement not to compete, and research and mining exploration costs.

AmortizationCapitalizationDepletionDepreciationFair market valueGoing concern valueGoodwillIntangible propertyPersonal propertyRecaptureSection 179 deductionSection 197 intangiblesTangible property

If you purchase property to use in your business, your basis is usually its actual cost to you. If you construct, create, or otherwise produce property, you must capitalize the costs as your basis. In certain circumstances, you may be subject to the uniform capitalization rules, next.

Go to the IRS.gov web site and use the search box for Publication 551 Publication 551 Main Contents Table of Contents Cost Basis

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