Bill > S1639

This bill amends the Internal Revenue Code to enhance tax benefits for research and development (R&D) activities by making several key changes. First, it restores immediate expensing for R&D investments, allowing businesses to deduct research expenditures in the year they are incurred, rather than amortizing them over time. Second, the bill expands the refundable research credit for new and small businesses by incrementally increasing the cap on refundable credits from $250,000 to $750,000 by 2035, extending eligibility from a 5-year to an 8-year period for startup businesses, and raising the gross receipts threshold for qualifying businesses from $5 million to $15 million. Third, the bill increases access to the research credit for startups by allowing qualified small businesses to use a higher percentage (20% instead of 14%) when calculating their research credit and providing more flexible calculation methods for businesses with fluctuating research expenses. These changes are designed to encourage innovation, support small businesses and startups, and provide more immediate tax benefits for companies investing in research and experimental activities. The amendments will generally apply to taxable years beginning after December 31, 2021, or 2024, depending on the specific provision.

Budget and Finance

https://www.congress.gov/bill/119th-congress/senate-bill/1639/all-info