Internal Revenue Code, § 197. Amortization Of Goodwill And Certain Other Intangibles

which is acquired by the taxpayer after the date of the enactment of this section, and

which is held in connection with the conduct of a trade or business or an activity described in section 212.

which is not described in subparagraph (D), (E), or (F) of subsection (d)(1), and

which is created by the taxpayer.

goodwill,

going concern value,

any of the following intangible items:

any license, permit, or other right granted by a governmental unit or an agency or instrumentality thereof,

any covenant not to compete (or other arrangement to the extent such arrangement has substantially the same effect as a covenant not to compete) entered into in connection with an acquisition (directly or indirectly) of an interest in a trade or business or substantial portion thereof, and

any franchise, trademark, or trade name.

The term “customer-based intangible” means—

In the case of a financial institution, the term “customer based intangible” includes deposit base and similar items.

in a corporation, partnership, trust, or estate, or

under an existing futures contract, foreign currency contract, notional principal contract, or other similar financial contract.

Any—

For purposes of subparagraph (A), the term “computer software” means any program designed to cause a computer to perform a desired function. Such term shall not include any data base or similar item unless the data base or item is in the public domain and is incidental to the operation of otherwise qualifying computer software.

Any interest in a film, sound recording, video tape, book, or similar property.

Any right to receive tangible property or services under a contract or granted by a governmental unit or agency or instrumentality thereof.

Any interest in a patent or copyright.

To the extent provided in regulations, any right under a contract (or granted by a governmental unit or an agency or instrumentality thereof) if such right—

an existing lease of tangible property, or

except as provided in subsection (d)(2)(B), any existing indebtedness.

If there is a disposition of any amortizable section 197 intangible acquired in a transaction or series of related transactions (or any such intangible becomes worthless) and one or more other amortizable section 197 intangibles acquired in such transaction or series of related transactions are retained—

In the case of any section 197 intangible which is a covenant not to compete (or other arrangement) described in subsection (d)(1)(E), in no event shall such covenant or other arrangement be treated as disposed of (or becoming worthless) before the disposition of the entire interest described in such subsection in connection with which such covenant (or other arrangement) was entered into.

All persons treated as a single taxpayer under section 41(f)(1) shall be so treated for purposes of this paragraph.

In the case of any section 197 intangible transferred in a transaction described in subparagraph (B), the transferee shall be treated as the transferor for purposes of applying this section with respect to so much of the adjusted basis in the hands of the transferee as does not exceed the adjusted basis in the hands of the transferor.

The transactions described in this subparagraph are—

The term “franchise” has the meaning given to such term by section 1253(b)(1).

Any renewal of a franchise, trademark, or trade name (or of a license, a permit, or other right referred to in subsection (d)(1)(D)) shall be treated as an acquisition. The preceding sentence shall only apply with respect to costs incurred in connection with such renewal.

Any amount to which section 1253(d)(1) applies shall not be taken into account under this section.

the amount paid or incurred by the acquirer under the assumption reinsurance transaction, over

the amount required to be capitalized under section 848 in connection with such transaction.

The term “amortizable section 197 intangible” shall not include any section 197 intangible which is described in subparagraph (A) or (B) of subsection (d)(1) (or for which depreciation or amortization would not have been allowable but for this section) and which is acquired by the taxpayer after the date of the enactment of this section, if—

If—

For purposes of this paragraph—

Subparagraph (A) shall not apply to the acquisition of any property by the taxpayer if the basis of the property in the hands of the taxpayer is determined under section 1014(a).

With respect to any increase in the basis of partnership property under section 732, 734, or 743, determinations under this paragraph shall be made at the partner level and each partner shall be treated as having owned and used such partner's proportionate share of the partnership assets.

The term “amortizable section 197 intangible” does not include any section 197 intangible acquired in a transaction, one of the principal purposes of which is to avoid the requirement of subsection (c)(1) that the intangible be acquired after the date of the enactment of this section or to avoid the provisions of subparagraph (A).