---
title: "Done: Repeal Five-Year Amortization of R&D Investments"
summary: |-
  The One Big Beautiful Bill Act, as signed into law by President Trump on July 4, 2025, implements this recommendation by allowing companies to immediately expense all domestic R&D under the new §174A, reversing the previous requirement.
date: "2021-09-07"
issues: ["Science and R&D", "Taxes and Budget", "Enterprise Policy"]
content_type: "Knowledge Base Articles"
canonical_url: "https://itif.org/publications/2021/09/07/to-do-repeal-five-year-amortization-of-rd-investments/"
---

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

# Recommendation

Congress should repeal the 2017 Tax Cuts and Jobs Act (TCJA) provision requiring companies to amortize their R&D investments over five years.

# Details

The 2017 Tax Cuts and Jobs Act (TCJA) requires companies to amortize their R&D investments over five years instead of expensing them in the same year they incur the costs. This disincentives companies from investing in R&D because it raises the cost and reduces the value of these investments. As a result of this, innovation could slow, jobs will be lost, and U.S. competitiveness will suffer. Congress should repeal this provision in the TCJA and instead permit firms to expense their R&D investments in the same year the cost is incurred.

**Keep reading:**

- Robert D. Atkinson, “The Case for Repealing the R&D Amortization Provision in the 2017 Tax Cuts and Jobs Act” (ITIF, September 2021), [https://itif.org/publications/2021/09/07/case-repealing-rd-amortization-provision-2017-tax-cuts-and-jobs-act/](https://itif.org/publications/2021/09/07/case-repealing-rd-amortization-provision-2017-tax-cuts-and-jobs-act/).

# Update

The One Big Beautiful Bill Act, as signed into law by President Trump on July 4, 2025, implements this recommendation by allowing companies to immediately expense all domestic R&D under the new §174A, reversing the previous requirement under the TCJA.

**Details:**

- One Big Beautiful Bill Act, H.R. 1, 119th Congress (2025), [https://www.congress.gov/bill/119th-congress/house-bill/1/text](https://www.congress.gov/bill/119th-congress/house-bill/1/text).

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*Source: Information Technology & Innovation Foundation (ITIF)*
*URL: https://itif.org/publications/2021/09/07/to-do-repeal-five-year-amortization-of-rd-investments/*