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Is Section 174 a driver for these layoffs? It now eliminates the ability for businesses to deduct their R&D expenditures as an expense. https://www.irs.gov/pu
by tiffanyh 3y ago
Is Section 174 a driver for these layoffs?
It now eliminates the ability for businesses to deduct their R&D expenditures as an expense.
https://www.irs.gov/pub/irs-drop/rp-23-08.pdf https://www.irs.gov/pub/irs-drop/rp-23-08.pdf
- mullingitover 3y agoIt doesn't eliminate it, just eliminates the ability to realize it 100% up front. Now, it has to be amortized over five years for domestic companies, 15 years for foreign companies.
- deleted 3y ago[deleted]
- coffeebeqn 3y agoI can’t imagine this would be an issue for a trillion dollar company
- stock_toaster 3y agoI wondered about this as well. Another article I ran across: https://blog.pragmaticengineer.com/section-174/ https://blog.pragmaticengineer.com/section-174/
- brandensilva 3y agoWorse change in startup history while we are in an high borrowing rate in an inflationary environment with limited capital.
- hn_throwaway_99 3y agoSection 174 usually is more of an issue for smaller/private companies. On the contrary, when I worked for a bigger company, we specifically tried to capitalize as much software development costs as possible, because it makes the company look more profitable. We (all of the software engineers) hated this because, for an internet-facing company that does continuous deployment, bucketing "new work" into CapEx vs "maintenance" into OpEx is nearly impossible when you're just adding new features to an existing product over time.