Reinstating Section 174 R&D tax provisions is vital to small business. Â
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In late March, NSBA joined the Innovation Community in a letter to Sen. Joni Ernst (R-Iowa) urging action on the bipartisan, bicameral Tax Relief for American Families and Workers Act of 2024 (H.R. 7024). Â
This tax plan was announced in January, overwhelmingly passing out of the House by a vote of 357-70. H.R. 7024 would restore provisions of Section 174 of the tax code relating to first-year expensing of research and development (R&D) investment by American small businesses. Â
New rules around R&D expensing went into effect in 2022, under which small-business owners are required to amortize R&D investments over five to 15 years. Â
This change dramatically increases annual tax liability and disincentivizes innovation-generating investments, and small-business owners are disproportionately hit by this standard. Â
Read the full letter to Senator Ernst here, and follow NSBA as we continue following progress and urging the Senate to pass H.R. 7024. Â