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Tax Policy: Issues and Policy Proposals Regarding Tax Treatment of Intangible Assets

GGD-91-88 Published: Aug 09, 1991. Publicly Released: Aug 09, 1991.
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Highlights

Pursuant to a congressional request, GAO provided information regarding the extent to which business taxpayers can deduct the price they pay for intangible assets, focusing on: (1) types of deductible intangible assets and their claimed values and useful lives; (2) industries claiming such deductions; and (3) various proposals for revising intangible asset tax rules.

Recommendations

Matter for Congressional Consideration

Matter Status Comments
Congress should consider revising current tax law to allow amortization of purchased intangible assets, including goodwill, over specific statutory cost recovery periods.
Closed – Implemented
Congress considered and passed legislation to allow the amortization of most purchased intangible assets over a specific cost recovery period. The legislation was vetoed by the President. Congress did not override the veto.

Full Report

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Topics

Accounting proceduresAmortizationCorporationsFair market valueIntangible assetsProposed legislationTax administrationTax creditTax lawTax shelters