Working with the Treasury's final capitalization-of-intangibles rules

Accounting Today, February, 2004 by George G. Jones

Final capitalization-of-intangibles regulations topped the list of new guidance that the Treasury Department recently pushed out in time for the start of tax season. Taxpayers can breath a deep sigh of relief on several important issues in these highly anticipated rules.

However, the final regs do force taxpayers to adopt new procedures if they wish to capitalize on certain aspects that have been liberalized since the release of the proposed regs in 2002.

What's covered, what's not

The final regs under Code Section 263 cover amounts paid to acquire or create an intangible. Amounts paid to acquire or create an intangible must be capitalized when involving:

* An acquired intangible (ownership in a corporation, partnership, LLC or other...