BNA's Daily Tax Report: IRS Ruling on Intangibles Seen Creating New Opportunities for Like-Kind Exchanges
An article published by members of Baker Hostetler's Tax Practice was the focus of an article, "IRS Ruling on Intangibles Seen Creating New Opportunities for Like-Kind Exchanges," in the July 6, 2009, edition of the Bureau of National Affairs' Daily Tax Report.
According Baker's Tax team, buyers and sellers of businesses could find new opportunities to defer taxes in a like-kind exchange as a result of a February Internal Revenue Service ruling on intangibles. The ruling, Chief Counsel Advice 200911006, reversed the IRS's long-standing position that intangibles such as trademarks, trade names, mastheads, and customer-based intangibles could not qualify as like-kind property under tax code Section 1031, the firm said ( 48 DTR K-3, 3/16/09).
In the past, according to the team's analysis, the IRS viewed the intangibles as too closely related to the goodwill or going-concern value of a business. However, in the February CCA, the government said these intangibles may qualify as like-kind property assuming they can be separately valued apart from the goodwill of a business.
To read the full article published by the Baker team, please click here.