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socrateaser, Lawyer
Category: Tax
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Experience:  Retired (mostly)
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I bought an existing business that included in the purchase

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I bought an existing business that included in the purchase price the cost of Goodwill and customer lists. Is this cost a business expense that can be deducted
The value of goodwill is generally amortized over a 15 year period, under IRC 197.

In plain English, you would divide the cost of goodwill by 15 and deduct 1/15th of the cost from your income each year for the following 15 years of business, or until you sell or otherwise dispose of the business.

Hope this helps.
socrateaser and 2 other Tax Specialists are ready to help you
Customer: replied 3 years ago.

Can the deduction be written off under Section 179

Under IRC 179(d), property which can be expensed does not include intangible goodwill. So, you cannot use a 179 deduction to accelerate the deductibility of the purchased goodwill.

Hope this helps.

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