In 2015, your client, Clear Corporation, changed from the cash to the accrual method of accounting for its radio station. The company had a positive § 481 adjustment of $2.4 million as a result of the change and began amortizing the adjustment in 2015. In 2016, Clear received an offer to purchase the assets of the radio station business (this would be considered a sale of a trade or business under § 1060). If the offer is accepted, Clear plans to purchase a satellite television business. Clear has asked you to explain the consequences of the sale of the radio station on the amortization of the § 481 adjustment?
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