4 ms·
See section 5 of this IRS guidance: https://www.irs.gov/pub/irs-drop/n-23-63.pdf https://www.irs.gov/pub/irs-drop/n-23-63.pdf tldr: if they're developing new f
by agwa 3y ago
See section 5 of this IRS guidance: https://www.irs.gov/pub/irs-drop/n-23-63.pdf https://www.irs.gov/pub/irs-drop/n-23-63.pdf
tldr: if they're developing new features, it has to be capitalized; if they're doing maintenance then it can be immediately expensed
- ryandrake 3y agoThis is actually great if true! Maybe companies will finally be incentivized to start fixing their bugs rather than cramming unwanted features and UI re-designs into their software products! However I doubt they'd leave such an obvious loophole. Surely the IRS's definition of R&D includes all types of software development activity.
- agwa 3y ago> However I doubt they'd leave such an obvious loophole. Surely the IRS's definition of R&D includes all types of software development activity. I literally just linked to the IRS' definition that says not all software development activity is included.
- ryandrake 3y agoNo, it's really cool, totally glad to see!
- PaulDavisThe1st 3y agoIt's not an "obvious loophole". They are quite specific about this. New features, new capabilities: R&D, must be amortized. Bug fixes for existing features: expensable. The gray zone comes when a bug fix actually provides a new feature (e.g. something that wasn't actually usable before).
- jay_kyburz 3y agoYou get an AI to write your new features (free). And your developers can fix the bugs and change the UI.
- pcthrowaway 3y agoI wouldn't say it's good. Startups are going to axe their QA teams and ship broken software so they can fix it after the fact
- stefan_ 3y agoCan't wait for the JIRA workflows around this