High dollar domains : are they assets or expenses?

What does your account say?

[fischermx]

When choosing an accouting firm to bookeeping I guess experience in online business is very important.
I'm in talks with several accountants and they have different views of this operation.
When you buy a domain for high dollars, say X,XXX, is that an asset or an expense?
How do you deduct it?

[iamlost]

Disclaimer: I am not an accountant please discuss my opinion with a competent accountant.

How you list a domain name depends on the definition/tax benefit of the various choices and that can vary by jurisdiction.

Basically you have three choices:
* expense.
* intangible asset.
* capital asset.

There are quite explicit requirements for each - see where/if your usage fits. Many tax agencies are still deciding how and when what applies. Without a tax policy decision use the one that you can make the best case for and saves you the most tax. I expect that use/park, renewal period, etc. will be important considerations.

For what it is worth mine are listed as "intangible assets" just like trade and service marks.

In chosing an accountant pick one you can talk with, who will take the time to discuss/explain options, will admit ignorance, will research and learn as required ... these are priorities; online company experience, international regulation knowledge, etc. are icing on the cake.

[fischermx]

For what it is worth mine are listed as "intangible assets"
just like trade and service marks.

That means, you didn't really deduct it, right?
I mean, if by near the end of the year, I have some spare bucks to expend, I would like to buy a few high dollar domains(or many medium dollar, well) to put them on PPC.
However, if they're assets, they won't help me to lower my tax payment, right?

[iamlost]

Reiterated Disclaimer: I am not an accountant please discuss my opinion with a competent accountant.

If you are Canadian (I am): since 2002 corporations no longer have to amortise the cost of their intangible assets every year but can - take your choice.
Note: most companies I am familiar with do so over 5 to 10 years with an annual re-assessment of future recoverability or impairment.
Note: As I pay 10-years up front for my Domain Names I use 10-year amortisation.

If you are American: Section 197 intangibles have a 15-year amortization period.

Anywhere else I know nada.