Answer :
Final answer:
The recovery period for Section 197 intangibles is 15 years, as per the IRS. This applies to several intangible assets, differing from the 5-year recovery period for solar panels and the general 21-year guideline for patents.
Explanation:
The recovery period for Section 197 intangibles is 15 years. This uniform capitalization period is stipulated by the Internal Revenue Service (IRS) for the amortization of certain intangible assets. These assets typically include goodwill, going concern value, and the workforce in place among others.
Comparatively, other recovery or amortization periods for different assets can vary, such as the 5 years for the recovery of solar panel fabrication, which correlates to the time taken for the panel's output energy to pay off its production cost. Similarly, the 21-year time period serves as a general guideline for patents, allowing the inventor to earn back their investment while preventing them from holding a permanent monopoly.
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