Re:Amazon R&D spending is more than that of all companies an...
by PaulDavisThe1st on Monday January 15, 2024 @08:12PM
(#39008192)
Section 174 has nothing to do with "detaxing R&D".
The US tax code already requires that self-classified R&D expenditures be treated as capital-expenditures, and subject to a 5-15 year depreciation period.
Section 174 requires that any and all software development costs be treated as R&D expenditures, and thus capitalized/amortized.
The total tax paid at the end of the depreciation period will be the same, but the upfront tax in the first year of a given expenditure is now 5-15x higher (depending on where the work was done).
The US tax code already requires that self-classified R&D expenditures be treated as capital-expenditures, and subject to a 5-15 year depreciation period.
Section 174 requires that any and all software development costs be treated as R&D expenditures, and thus capitalized/amortized.
The total tax paid at the end of the depreciation period will be the same, but the upfront tax in the first year of a given expenditure is now 5-15x higher (depending on where the work was done).