* Class VII assets: These consist of good-will and going-concern value
(whether or not the goodwill or going-concern value
qualifies as .a Sec.
It is unclear when HUD began its policy of allocating a portion of the net operating income and of the going-concern value
to proprietary earnings, but James K.
. Part I of this Response explains that they find no
If we assume that assets can be sold for their estimated going-concern value
, a typical firm's return matches the return to a benchmark portfolio.
The information required to be reported from the parties of an applicable asset acquisition include 1) amounts allocated to goodwill or going-concern value
, 2) amounts allocated to other categories of assets or specific assets, and 3) other information the IRS deems necessary or appropriate.
[section] 1.1031(a)-2(c)(2) provides that goodwill and going-concern value
of dissimilar businesses are not of a like kind and, further, that goodwill and going-concern value
of similar businesses are of like kind only in rare and unusual circumstances.
The residual method allocates the purchase price among seven asset classes, starting with the most liquid assets (with cash as class I) and moving on to assets with lesser liquidity (with goodwill and going-concern value
as class VII).
This framework is comparable to one provided in Figure 2.1 of The Appraisal of Real Estate, 13th edition (Appraisal Institute, 2008, page 30), where the going-concern value
of a business enterprise is divided between tangible property (composed of personal property and real property) and intangible property of various types.
In fact, even the going-concern value
of an agency (tangible assets plus intangible assets, such as goodwill) may have little bearing on the actual purchase price of an agency.
the remaining cases, going-concern value
was small or nonexistent.
According to the IRS, when a corporation distributes "clients and customer-based intangibles" to its shareholders, IRC sections 331 and 336 apply; such intangibles include the corporation's client base, client records, workpapers and goodwill (including going-concern value
We define our estimates as the difference between the going-concern value
and the liquidation value of the firm's assets.