Question

Which asset is not an intangible asset subject to 15-year amortization?

a. a covenant not to compete
b. Goodwill
c. a franchise
d. a license granted by a government unit or agency
e. all of the above are subject to 15-year amortization as intangibles

Answer 1

Goodwill is not an intangible asset subject to 15-year amortization unlike covenants not to compete, franchises, and licenses granted by a government unit or agency, which can be amortized over this period.

Step-by-step explanation:

The asset that is not an intangible asset subject to 15-year amortization is goodwill. Whereas covenants not to compete, franchises, and licenses granted by a government unit or agency are intangible assets that the Internal Revenue Service allows businesses to amortize over a 15-year period, goodwill is also an intangible asset but it is only subject to amortization if there is a change in ownership and even then, it may be subject to different rules compared to other intangible assets.