However, the total software cost must be amortized to obtain the amortized software cost- Cost_Am_Soft, calculated as Cost_Am_Soft= [Cost_Tot_Soft * Ap_F] (Ap_F is
Amortizable Parameter for Facility)
How is the amount of
amortizable bond premium determined?
so they should be
amortizable as business start-up expenses.
Profits of foreign-owned companies were also adjusted to include three items that are treated as expenses in the computation of PTR but not in the computation of NIPA profits: Expenditures for petroleum and natural gas exploration and development, amortization of intangible assets, and purchases of software.(34) The estimates of amortization of intangible assets were computed in three steps: First, the stock of
amortizable intangible assets was estimated from balance sheet data for the companies reported on the direct investment surveys and for all U.S.
In a taxable acquisition of a trade or business (or a substantial portion thereof) occurring after the date of enactment of OBRA 1993, Section 197 effectively provides that the excess of the purchase price over the fair market value of the target's tangible assets will be treated as an "
amortizable Sectio 197 intangible" and written off ratably over a 15-year period.
For example, implementation of an enterprise resource planning (ERP) system could consist of acquired software (36-month
amortizable life under Rev.
He explained that [section] 197 was entered into the IRS Code in 1993 and determined that certain intangible assets were
amortizable over a 15-year period.
A properly structured "lease inducement" is
amortizable over the lease term.
Treasury Regulations section 1.197-2(g)(8) states: "An
amortizable section 197 intangible is treated as property of a character subject to the allowance for depreciation under section 167.
To the extent that the costs are treated as creating a new asset, the Notice asked whether the asset should be amortized and what the appropriate
amortizable useful life should be.
SFAS 144 requires impairment testing of
amortizable intangibles at the lowest level of identifiable and independent cash flows.
Taxpayers also need to recognize that IRC section 197 includes covenants as an
amortizable intangible with a 15-year useful life if purchased in connection with a business acquisition.
