I bought my father in-law's cleaning business. There is no equipment involved just the client base. I paid a down payment and I am making monthly payments for the remainder of the purchased business. My understanding is that I have to amortize this on schedule C, but I am not sure over how many years. Any help and additional comments are greatly appreciated.
Amortization
Nov 29, 2007
1 Replies
Pub 535 covers this topic--180 month amortization of Sect 197 intangibles.
The amount of your down payment is irrelevant, you will use the total cost of the purchase to calculate the deduction. Things can get a little stickier with the interest (there can be "implied interest,") you and your father-in- law may want a consult on that.
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