Final Regulations on Allocating Asset Sale Purchase Prices

Title:
Final Regulations on Allocating Asset Sale Purchase Prices
Practice:

In asset purchase and sale transactions, the purchase price must be allocated into seven categories when reported to the IRS according to new final regulations effective after March 16, 2001. Prior to the issuance of these regulations, certain purchasers and sellers of assets were required to allocate the purchase price for such assets into 5 categories. The IRS has now increased the number of categories to which the purchase price must be allocated to 7 categories, which are as follows: