In 2001, a legal decision prohibited the amortization of goodwill as an intangible asset. However, in 2014, parts of this ruling were rolled back; amortization is now allowable in certain situations.

Does goodwill have to be amortized?

It is classified as an intangible asset on the balance sheet, since it can neither be seen nor touched. Under US GAAP and IFRS, goodwill is never amortized, because it is considered to have an indefinite useful life.

When did goodwill become tax deductible?

The tax treatment of goodwill is currently governed by IRC section 197, which became law on August 10, 1993.