How do you treat legal fees paid to an attorney to obtain Trademark for an LLC that started business and terminated business in the same year?
Sandy
Sandy
-
-
A trademark is a section 197 intangible, amortized over 15 years. If it is disposed of before the end of that period, you write off the remaining basis, provided you get rid of all other 197 intangible assets. If you keep any of the 197 intangibles, the basis of the one disposed of transfers over to the assets you keep.
I assume since the business is no longer a business, all assets were abandoned and you can write off the loss. But if the owner keeps the trademark and does not abandon it, you can't write off the loss.
An example would be you obtain the trademark for a business name, but you decide not to pursue the business at this time. But you want to keep the right to use that name, say 5 years from now when you intend to start up the business again. You can't write off the cost of the trademark because you have not yet abandoned the right to use it. -
Thank you
Bees,
It is always comforting to know that you, Armando and others are there to answer our questions! Thank you for your reply and giving such clarity to what we seem to perceive as a more complicated issue, or simply can't find the answer or apply to the situation. Or simply "Brain Dead" !
SandyComment
Comment