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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 mdavidn on Tuesday June 10, 2025 @12:14PM (#44238544)
The usual thinking is that you want an asset’s upfront expense spread over the years that asset earns income to reduce taxable profit in future years.
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Re:Tell HN: Help restore the tax deduction for software dev ... by kgwgk on Tuesday June 10, 2025 @12:33PM (#44238757)
> In other words, the IRS receives more upfront but less total in the end.

How so?

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Re:Tell HN: Help restore the tax deduction for software dev ... by thayne on Tuesday June 10, 2025 @01:07PM (#44239080)
> In other words, the IRS receives more upfront but less total in the end.

Assuming positive inflation, the IRS receives more total, because the taxes they get paid now are worth more than the same amount of dollars they give back in later years. And if the company goes out of business, the IRS never has to give those taxes back.

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