I produced a theatrical production (live song and dance show) and the show is performed at one of the hotels in Las Vegas (for over 4 years). The hotel wants to buy the show.

We are an "S" Corp (only one partner at this time). They do not want to prohibit us from producing the show somewhere else, but just want to own the show as it is now running in their hotel.

What do I need to sell in order to get capital gains treatment. I'm aware of IRS pub.544 where it talks about selling "intangibles"; code section 1221 where it says if I produced it or responsible for any part of it, it is excluded from the definition of capital gains.

What would have to happen for the hotel to own (at least in essence) the show or the know how of how to run the show, the formula, etc. I will also be transferring the existing employees to them.

My CPA is more persuaded towards the sec code 1221. I am not.

Many Thanks,

TMP