Scott purchases a small business from Lew on July 1, 2018.He paid the following amounts for the business: $\begin{array}{llcc}
\text {Land } &\$100,000 \
\text { Commercial building } &200,000\
\text { Furniture and equipment } &78,500\
\text {Going-concern value } &50,000\
\text {Workforce in place } &29,500\
\text { Total } &\underline{\$458,000}\
\end{array}$

a.How much of the $458,000 purchase price is for Section 197 intangible assets?
b.What amount can Scott deduct on his 2018 tax return as Section 197 intangible amortization?

Question

Scott purchases a small business from Lew on July 1, 2018.He paid the following amounts for the business: $\begin{array}{llcc}
  \text {Land  } &\$100,000  \
 \text { Commercial building } &200,000\
 \text { Furniture and equipment } &78,500\
 \text {Going-concern value  } &50,000\
 \text {Workforce in place  } &29,500\
 \text { Total } &\underline{\$458,000}\
\end{array}$
 
a.How much of the $458,000 purchase price is for Section 197 intangible assets?
b.What amount can Scott deduct on his 2018 tax return as Section 197 intangible amortization?

Quizplus · Accepted Answer

The Answer of Scott purchases a small business from Lew on July 1, 2018.He paid the following amounts for the business: $\begin{array}{llcc}
  \text {Land  } &\$100,000  \
 \text { Commercial building } &200,000\
 \text { Furniture and equipment } &78,500\
 \text {Going-concern value  } &50,000\
 \text {Workforce in place  } &29,500\
 \text { Total } &\underline{\$458,000}\
\end{array}$
 
a.How much of the $458,000 purchase price is for Section 197 intangible assets?
b.What amount can Scott deduct on his 2018 tax return as Section 197 intangible amortization?

Scott Purchases a Small Business from Lew on July 1