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from the Rose customer accounts, based on Rose’s income and
petitioner’s customer data, was exceptionally accurate, showing
that the income was readily predictable.
Petitioner has shown that the acquired and acquiring
brokerages had essentially the same discount approach to business
and that Rose’s customers and petitioner’s customers were
categorized and treated similarly. Petitioner has also shown
that it was able to separate the Rose customer accounts from the
Rose infrastructure and that the Rose name and operational know-
how were completely abandoned. Therefore, the customer accounts
have been shown to be an exploitable asset distinct from the
generalized umbrella of “goodwill” that may have existed in the
Rose business and name.
In the setting we consider here, the brokerage customer
accounts are valued according to their potential to generate a
future income stream, and petitioner has shown that they are
distinct from goodwill and have a limited useful life. See,
e.g., Citizens & S. Corp. v. Commissioner, 91 T.C. 463, 500
(1988). In particular, the brokerage customer accounts were the
only asset of value acquired from Rose, and most of the remaining
assets acquired from Rose, including the “Rose” name, were
abandoned. Accordingly, and as discussed later in this Opinion,
petitioner has shown that the customer accounts can be valued and
that they waste “over an ascertainable period of time”. Newark
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