§13261

13261(g), 107 Stat. 540. Sec. 197, by reason of its effective date, does not apply to the instant cases.

13261 (a), (g), 107 Stat. 312, 532, 540. Sec. 197 does not apply to the assets in issue in the instant case because they were acquired prior to the date of (continued...) - 42 - The parties agree that the acquired contract rights must be amortized using the straight line method.31 Under 30(...continued) enactment.

Class I $ 6,800,000 Class II -0- Class III 1, O06, 964 , 727 Class IV 595, 625, 973 In the RSI consolidated group 1/31/93 consolidated return and the RSI consolidated group 1/31/93 amended consolidated return, pursuant to section 13261(g) (2) and (3) of the Omnibus Budget Reconciliation Act of 1993, Pub.

13261 (a), (g), 107 Stat. 312, 532, 540. Sec. 197 does not apply to the assets in issue in the instant case because they were acquired prior to the date of (continued...) - 42 - The parties agree that the acquired contract rights must be amortized using the straight line method.31 Under 30(...continued) enactment. 31 Numerous obsolete provisi

- limited and reasonably determinable. Id. There was some uncertainty, however, over.what constituted an amortizable intangible asset and the proper method and period for depreciation. See Omnibus Budget Reconciliation Act of 1993, Pub. L. 103-66, sec. 13261, 107 Stat. 532. Congress enacted section 197 to resolve some of the uncertainty surrounding the regulation. H. Rept. 103-111, at 777 (1993), 1993-3 C.B. 167, 353. An "amortizable intangible" is now defined as an intangible acquired by and h

13261(g)(2) and (3), 107 Stat. 540, as amended by the Small Business Job Protection Act of 1996, Pub. L. 104-188, sec. 1703(1), 110 Stat. 1875. - 13 - Respondent asserted protective deficiencies against both William Becker and BHC, alternatively disagreeing with each party’s characterization of the transaction, in order to avoid being “whipsa

13261(g), 107 Stat. 312, 540. Sec. 197, however, expressly excludes most self-created intangible assets from amortization treatment thereunder, and petitioner herein makes no argument that it should be entitled under sec. 197, for 1994 or any other year, to amortize any cost basis in the group contracts. - 28 - In Globe Life & Accident Ins. C

13261(g), 107 Stat. 540. 7 the Chevron gas station in 1995.3 We conclude that petitioner had a basis of $5,000 when he sold the gas station in 1995. 3. Whether Petitioner Paid $99,000 for Improvements Petitioner testified and contends that, in 1994, he purchased about $99,000 in improvements, including a gas dispenser pump, underground piping

the course of its life. Warsaw Photographic 2 Sec. 197, Amortization of Goodwill and Certain other Intangibles, generally applies with respect to property acquired after Aug. 10, 1993. See Omnibus Budget Reconciliation Act of 1993, Pub. L. 103-66, sec. 13261(g), 107 Stat. 540; see also Spencer v. Commissioner, 110 T.C. 62, 87 n.30 (1998), affd. without published opinion 194 F.3d 1324 (11th Cir. 1999). - 7 - Associates, Inc. v. Commissioner, 84 T.C. 21, 48 (1985); O'Dell & Co. v. Commissioner, 6

(E). Execution of the 1990 noncompetition agreement was contingent upon the prior occurrence of particular events. The 1990 noncompetition agreement would be executed if Burien Nissan 21See Omnibus Budget Reconciliation Act of 1993, Pub. L. 103-66, sec. 13261(g), 107 Stat. 540, for effective date. - 16 - purchased Mr. Johnston’s remaining 61,200 shares for $215,000 in monthly installments over a 30-month period beginning in June of 1990, and Mr. Johnston transferred the shares to Burien Nissan a

acquired. See sec. 197(a). An “amortizable section 197 intangible” is any section 197 intangible acquired by a taxpayer after August 10, 1993,5 and held in connection with the conduct 5See Omnibus Budget Reconciliation Act of 1993, Pub. L. 103- 66, sec. 13261(g), 107 Stat. 540, for effective date; see also Spencer v. Commissioner, 110 T.C. 62, 87 n.30 (1998), affd. without published opinion 194 F.3d 1324 (11th Cir. 1999). - 7 - of a trade or business. Sec. 197(c)(1). A covenant not to compete e

(E). Execution of the 1990 noncompetition agreement was contingent upon the prior occurrence of particular events. The 1990 noncompetition agreement would be executed if Burien Nissan 21See Omnibus Budget Reconciliation Act of 1993, Pub. L. 103-66, sec. 13261(g), 107 Stat. 540, for effective date. - 16 - purchased Mr. Johnston’s remaining 61,200 shares for $215,000 in monthly installments over a 30-month period beginning in June of 1990, and Mr. Johnston transferred the shares to Burien Nissan a

Section 167(c)(2) was enacted as section 13261(b)(2) of the Omnibus Budget Reconciliation Act of 1993, Pub.

13261(a), (g), 107 Stat. 532, 540, and applies to property acquired after Aug. 10, 1993 (the date of enactment). Prior to the 1993 Act, acquired goodwill and going concern value were not amortizable, but other acquired intangible assets were amortizable if they could be separately identified and their useful lives determined with reasonable ac

13261(a), 107 Stat. 313, 532, effective generally for property acquired after Aug. 10, 1993). We are not here concerned with any such recovery. See supra n.3. - 32 - Although the mere presence of an incidental future benefit--”some future aspect”--may not warrant capitalization, a taxpayer’s realization of benefits beyond the year in which th

103-66, section 13261(a), 107 Stat. 532.) - 11 - It is true, as respondent points out, that the allocable purchase price exceeded the fair market value of the acquired tangible and amortizable intangible assets of LHJ. That does not dictate, however, that editorial costs incurred after the expiration of the 42-month useful life must be assigned to nonamor

66). In passing, we note that for intangibles acquired after August 10, 1993, section 197 allows a taxpayer to amortize the adjusted basis of the intangibles ratably over a 15- - 15 - year period. Revenue Reconciliation Act of 1993, Pub. L. 103-66, sec. 13261(a), 107 Stat. 312, 533. Covenant Not To Compete In this case, the seller was 65 years of age at the time he entered into the subject agreement with petitioner. He was not only suffering from the abdominal aortic aneurysm that led to his dea

13261(a), 107 Stat. 312, 553, which allows for 15-year amortization of acquired intangible assets, including, inter alia, goodwill and going-concern value. Sec. 197. This provision generally applies to intangibles acquired after Aug. 10, 1993. - 17 - (1956). Similarly, amounts paid by a buyer for a covenant not to compete result in ordinary i