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Risky startups with multiple years of R&D before revenue would be the least impacted.

You’re only paying taxes if the business is profitable ignoring investments like R&D spending.






You seem extremely confused.

Section 174 specifically made those R&D costs “ignorable” from a tax standpoint. When it ended R&D costs could no longer be used to offset income.


What specifically do you disagree with? That R&D is an investment? I mean outside of the tax code that’s what it means to do R&D.

As to my other point, the highest risk category of startup has zero customers for years they also have zero revenue, zero profit, and zero taxes to pay here. On the 5th year they can deduct R&D from each of those years making the net effect on them minimal vs a startup with profits on year 0.




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