Professional sports franchises amortizable under Sec. 197.The purchase price allocated to intangible assets Intangible Asset
An asset that is not physical in nature.
Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. (including franchise rights) acquired in connection with the acquisition of a trade or business generally must be capitalized Capitalized
Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. and amortized over a 15-year period. However, before enactment of the AJCA AJCA American Jobs Creation Act of 2004 (US)
AJCA American Jersey Cattle Association
AJCA Association of Juvenile Compact Administrators
AJCA All Japan Cooks Association
AJCA Alabama Junior Cattlemen’s Association , Sec. 197(e)(6) specifically excluded professional sports The examples and perspective in this article or section may not represent a worldwide view of the subject.
Please [ improve this article] or discuss the issue on the talk page. franchises and any item acquired in connection with them from the definition of a Sec. 197 intangible.
AJCA Section 886 extends the 15-year recovery period under Sec. 197 to professional sports franchises and any intangible acquired in connection with the acquisition of the franchise (including player contracts).Thus, it repeals the special rules under Sec. 1245(a)(4) for player contracts and makes other conforming changes to the statute.
This provision is generally effective for property acquired after Oct. 22, 2004. The amendment to Sec. 1245(a)(4) applies to franchises acquired after Oct. 22, 2004.
Because the Service viewed the professional sports franchise and associated media rights as having no ascertainable as·cer·tain
tr.v. as·cer·tained, as·cer·tain·ing, as·cer·tains
1. To discover with certainty, as through examination or experimentation. See Synonyms at discover.
2. useful life, considerable controversy arose over allocating the purchase price of these franchises. This was particularly the case in recent years, when a disproportionate dis·pro·por·tion·ate
Out of proportion, as in size, shape, or amount.
dispro·por value in the transactions was allocated to the franchise and media rights, rather than the player contracts. This provision eliminates this controversy and provides a uniform treatment.
FROM JANE ROHRS, WASHINGTON, DC