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Essentially. An extremely oversimplified scenario: On paper if you made $1M in revenue, and had $1M in salary expenses that were all R&D, you would deduct $200k
by zacharycohn 2y ago
Essentially. An extremely oversimplified scenario: On paper if you made $1M in revenue, and had $1M in salary expenses that were all R&D, you would deduct $200k of that salary and be left with $800,000 in "profit" that you have to pay taxes on.
Except you don't have $800k. You have $0k.
- giancarlostoro 2y agoYikes. I kept wondering why R&D has been dead for so long. I have made comments here on HN about how R&D is responsible for so many tech advancements we still use, especially at Bell Labs.
- zacharycohn 2y agoThis is a recent change, thanks to the 2018 tax code changes (the implementation was delayed until this tax year).
- jimbobthrowawy 2y agoWhy would that be counted as profit at all, if it was spent?