On January 1, 2018, SymboNet Company completed its acquisition of NetOpen. As part of the acquisition, $2 million was allocated to goodwill. What is SymboNet's amortization deduction related to the goodwill for 2018?

Question

Quizplus · Accepted Answer

Under the current U.S. tax code (as of 2021), goodwill acquired in a business acquisition can be amortized over 15 years for tax purposes. Therefore, the amortization deduction for SymboNet related to the goodwill for 2018 is $2,000,000 / 15 years = $133,333.

On January 1, 2018, SymboNet Company Completed Its Acquisition of NetOpen