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winktax
winktax, Enrolled Agent
Category: Tax
Satisfied Customers: 425
Experience:  18 years experience as an Enrolled Agent, insurance agent, stock broker and financial advisor.
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Hello, Can you comment on the use of estimates, source of

Resolved Question:

Hello,

Can you comment on the use of estimates, source of goodwill?

Thank you
Submitted: 5 years ago.
Category: Tax
Expert:  winktax replied 5 years ago.

winktax :

In general an estimated value can be used to allocate the purchase price of intangible assets that are not specifically identified. ie. allocation between goodwill, convent not to compete, customer list etc.

winktax :

The overall process of breaking down the value of an asset acquisition is outlined in IRC 1060, also Form 8594 - Asset acquisition Statement provides instructions as to the proper allocation of asset values from Class 1 assets (cash, general deposit accounts), Class 2 assets (traded personal property) to Class VII assets ( Goodwill, going concern value, Section 197 intangibles)

winktax :

I hope the above answers your question. If so please click the accept button. Otherwise please provide additional information and or clarifying questions so that I can provide a more specific answer.

Customer:

Hi,

Customer:

Can you give me some of sources?

Customer:

Thank you.

winktax :

Major general source of instructions are Form 8594 - Asset acquisition statement under section 1060 - http://www.irs.gov/instructions/i8594/index.html

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