R&D Amortization Rule in 2017 Tax Law Will Cut U.S. Growth by $45B and Cost 48,000 Jobs Unless Congress Repeals It, ITIF Finds

The tax provision allowing firms to fully expense their R&D costs in the year of investment expired, decreasing the incentive to invest in this key driver of economic growth and competitiveness. Congress should pass the American Innovation and R&D Competitiveness Act of 2025 to restore the immediate deductibility of R&D expenses.

R&D Investment Is Slipping: Bring Back Full R&D Expensing

It is time for Congress to restore the immediate expensing of R&D expenditures by passing the Tax Relief for American Families and Workers Act of 2024.

R&D Under Attack: How the Loss of Immediate Expensing Reduces Innovation Inputs

Although it contains many positive proposals, the Tax Reform Act of 2014 would reduce the effectiveness of R&D tax incentives.

Why The Tax Reform Act of 2014 Should Expand, Not Cut, The R&D Tax Credit

The policy rationale for the R&D tax credit and bonus depreciation is abundantly clear; Congress should extend and then make them permanent.

Congress Needs to Pass Tax Extenders That Encourage Investment and Jobs

The tax law allowing firms to fully expense their research and development (R&D) costs expired at the end of 2021, and full expensing of equipment costs will begin phasing out in 2023. This decreases firms’ incentive to invest in these key drivers of economic growth and competitiveness. Congress should restore and make permanent full expensing for these investments.

Why Congress Should Restore Full Expensing for Investments in Equipment and Research and Development

U.S. tax policy needs to prioritize innovation and competitiveness—especially as China rapidly gains ground as a leading innovator in advanced industries.

Twelve Tax Reforms to Spur Innovation and Competitiveness

Congress should allow small research companies to carry their net operating losses forward even after a change in ownership.

To Do: Allow Small Research Companies to Carry Forward Net Operating Losses

Congress should at least double the regular R&D tax credit to 40 percent and the Alternative Simplified Credit to 28 percent, since U.S. R&D tax credit support currently ranks 31st out of 28 OECD nations and the four BRIC economies.

Done: Repeal Five-Year Amortization of R&D Investments

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Editors’ Recommendations

The Case for Repealing the R&D Amortization Provision in the 2017 Tax Cuts and Jobs Act

Related

R&D Amortization Rule in 2017 Tax Law Will Cut U.S. Growth by $45B and Cost 48,000 Jobs Unless Congress Repeals It, ITIF Finds

R&D Investment Is Slipping: Bring Back Full R&D Expensing

R&D Under Attack: How the Loss of Immediate Expensing Reduces Innovation Inputs