If a corporation buys some stores from another corporation it pays a price. It then values all the tangible assets to find out how much it puts on its books as tangible assets to be depreciated over their respective useful lives. It will quite typically find that it paid more in total for the acquisition than the tangible assets are worth, but it is not usually required to report a loss for paying more than the sum of the values of the tangible assets. The difference is the value of the acquired businesses as going concerns, sometimes called 'good will.' That becomes an asset on the acquirers balance sheet to be depreciated over some period of time. The acquirer may also be able to assign some of the purchase price to capitalize such assets as deferred tax credits, contracts signed by the sold business, trademarks and licenses, etc. Those assets may be written down over years to offset income of the combined entity that would otherwise be taxable. Then there is the possibility of buying a corporation, holding it for a few years and then spinning it off tax-free, which can equivalent to a huge dividend to the shareholders of the purchasing company that never was taxable as corporate income.