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A comment on Tell HN: Help restore the tax deduction for software dev in the US (Section 174). Parent comment

Re:Tell HN: Help restore the tax deduction for software dev ... by procaryote on Tuesday June 10, 2025 @03:04AM (#44233577)
Under these rules no. If the "machine" is software, payroll is considered a capital expense and an asset. If it's an actual machine, payroll for building it is fully deductible, like most other payroll.

Software used to work like other payroll until fairly recently. If you want to understand this figure out why that changed and what the actual motivation behind it was

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Re:Tell HN: Help restore the tax deduction for software dev ... by kgwgk on Tuesday June 10, 2025 @03:16AM (#44233662)
> If it's an actual machine, payroll for building it is fully deductible, like most other payroll.

Not if the machine is used as an integral part of manufacturing, production, or extraction, or an integral part of furnishing transportation, communications, electrical energy, gas, water, or sewage disposal services by a person engaged in a trade or business of furnishing any such service, or is a research or storage facility used in connection with any of the foregoing activities.

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