Section 174: New Rules for Research & Experimentation

Overview

This program addresses the most recent developments impacting taxpayers incurring research and experimentation costs.  Emphasis will be placed on compliance with the 2022 change in Section 174 Amortization of research and experimental expenditures.

Prerequisites

Basic Tax Knowledge

Objectives

• Identify recent changes affecting the deduction of research and experimental expenditures.

Highlights

• Discussion of the impact of the Section 174 law change requiring capitalization of research and experimental costs.
• Comparison of the Section 41 R&E credit to the Section 174 R&E deduction.
• Financial accounting for R&E costs.
• Required change of accounting method and Form 3115.
• Revised treatment of software development costs.
• Comprehensive case problems explaining implementation of the law changes.