{"id":12381,"date":"2023-09-12T19:54:55","date_gmt":"2023-09-12T19:54:55","guid":{"rendered":"https:\/\/taxops.com\/?p=12381"},"modified":"2023-09-12T19:54:57","modified_gmt":"2023-09-12T19:54:57","slug":"guidance-is-out-on-%c2%a7174","status":"publish","type":"post","link":"https:\/\/taxops.com\/guidance-is-out-on-%c2%a7174\/","title":{"rendered":"Guidance is Out on \u00a7174"},"content":{"rendered":"\n<div style=\"height:51px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1024\" height=\"536\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/yH5BAEAAAAALAAAAAABAAEAAAIBRAA7\" data-src=\"https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-1024x536.png\" alt=\"\" class=\"wp-image-12387 lazyload\" data-srcset=\"https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-1024x536.png 1024w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-300x157.png 300w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-768x402.png 768w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-1080x565.png 1080w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-980x513.png 980w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-480x251.png 480w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174.png 1200w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><noscript><img decoding=\"async\" width=\"1024\" height=\"536\" src=\"https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-1024x536.png\" alt=\"\" class=\"wp-image-12387 lazyload\" srcset=\"https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-1024x536.png 1024w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-300x157.png 300w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-768x402.png 768w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-1080x565.png 1080w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-980x513.png 980w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174-480x251.png 480w, https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174.png 1200w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/noscript><\/figure>\n\n\n\n<div style=\"height:51px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"wp-block-paragraph\"><em>Guidance released under Notice 2023-63 focuses on the amortization of specified research or experimental expenditures under \u00a7174, and announces more regulations on the horizon. What does it mean for taxpayers? Read on for effective dates, rules, and what&#8217;s to come. <\/em><\/p>\n<\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\">The U.S. Treasury and IRS released guidance under <a href=\"https:\/\/taxops.us21.list-manage.com\/track\/click?u=ff5d1f31e7c53f48fa597324f&amp;id=20afc27952&amp;e=db3e962adc\">Notice 2023-63<\/a> on the amortization of specified research or experimental expenditures under \u00a7174. The primary aim of this notice is to announce that proposed regulations are coming to address modifications to the treatment of \u00a7174, particularly in relation to R&amp;D expenses. \u00a0 <br><br>The tax treatment under \u00a7174 changed due to the Tax Cuts and Jobs Act of 2017, affecting expenses incurred beginning with the 2022 tax year.\u00a0It is important to note that this notice is in the initial stages of proposed regulations and will evolve into final regulations at a later date. \u00a0 <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Below are some notable items that we have gathered from this notice: \u00a0<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"wp-block-paragraph\">1.\u00a0Under section 10 of the guidance, this notice would apply for taxable years ending after September 8, 2023. A taxpayer may, nevertheless, choose to rely on the rules described in section 3 through 9 of this notice for the 2022 tax year.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">2.\u00a0It is notable that the guidance requires taxpayers to include \u00a7174 related depreciation and amortization as part of their capitalization amount. Costs of the HR and personnel departments, such as recruiting R&amp;D professionals, are considered indirect and do not require capitalization. Treasury has also provided some clear contractor\/research provider guidance that had not been previously available.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">3.\u00a0Should this guidance become finalized regulations, some taxpayers may have an increased amount of capitalized costs versus what they can deduct for the tax year 2023 compared to 2022 amounts.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">4.\u00a0Section 11 specifically asks for comments regarding scope, software development, research performed under contract and other specific issues that the Treasury and IRS have yet to address.<\/p>\n<\/blockquote>\n\n\n\n<h3 class=\"wp-block-heading\">Key Takeaways<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>As 2023 guidance progresses and more specific details on standardized treatment becomes available, adjustments to your \u00a7174 approach and determination may become necessary.<\/li>\n\n\n\n<li>As a member of the AICPA working group dedicated to these tax matters, Mark is participating with a subcommittee to assess and comment further on this guidance.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Although stalled out, there is still the possibility that the U.S. Congress will step in and repeal or modify the law in ways that would allow taxpayers to choose once again to deduct immediately or capitalize and amortize \u00a7174 costs over a period of time. We\u2019ll keep you updated on any developments. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"https:\/\/taxops.us21.list-manage.com\/track\/click?u=ff5d1f31e7c53f48fa597324f&amp;id=47e6d6ce78&amp;e=db3e962adc\" target=\"_blank\" rel=\"noreferrer noopener\">Contact<\/a> your TaxOps Minimization Advisor with any questions.<\/p>\n\n\n\n<div style=\"height:41px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/taxops.com\/contact\/\" target=\"_blank\" rel=\"noreferrer noopener\">Let&#8217;s Talk Tax<\/a><\/div>\n<\/div>\n\n\n\n<div style=\"height:43px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-taxops wp-block-embed-taxops\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"y3YqEs3F2S\"><a href=\"https:\/\/taxops.com\/eligible-for-lucrative-rd-credits\/\">Eligible for Lucrative R&#038;D Credits?<\/a><\/blockquote><iframe class=\"wp-embedded-content lazyload\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;Eligible for Lucrative R&#038;D Credits?&#8221; &#8212; TaxOps\" data-src=\"https:\/\/taxops.com\/eligible-for-lucrative-rd-credits\/embed\/#?secret=kIBhf5fObV#?secret=y3YqEs3F2S\" data-secret=\"y3YqEs3F2S\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\">More Tax News<\/h3>\n\n\n<ul class=\"wp-block-latest-posts__list wp-block-latest-posts\"><li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/auditor-independence-in-the-age-of-private-equity\/\">Auditor Independence in the Age of Private Equity: What CFOs Need to Know<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/r-d-credits-for-software-companies\/\">R&amp;D Credits for Software Companies: Scrum Teams, Qualifiers, and Section 174 After OBBBA<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/section-174-decoupling-what-tax-pros-need-to-know-state-by-state\/\">Section 174 Decoupling: What Tax Pros Need To Know State By State<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/sean-espy-new-partner\/\">TaxOps Welcomes Sean Espy as Partner, Tax Minimization<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/state-nexus-demystified-navigating-tax-compliance-after-wayfair-episode-1-2\/\">Your Tax Footprint Is Probably Bigger Than You Think: What Finance Leaders Need to Know About State Nexus<\/a><\/li>\n<\/ul>\n\n\n<div style=\"height:43px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/taxops.com\/contact\/#subscribe\" target=\"_blank\" rel=\"noreferrer noopener\">Subscribe to Tax News<\/a><\/div>\n<\/div>\n\n\n\n<div style=\"height:43px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Guidance released under Notice 2023-63 focuses on the amortization of specified research or experimental expenditures under \u00a7174, and announces more regulations on the horizon. What does it mean for taxpayers? Read on for effective dates, rules, and what&#8217;s to come. The U.S. Treasury and IRS released guidance under Notice 2023-63 on the amortization of specified [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":12387,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"off","_et_pb_old_content":"","_et_gb_content_width":"","spt_transcript":"","footnotes":""},"categories":[382,78,226],"tags":[132,782,394,800,802,284,12,126,26,265,801,92,48,561,50,111,759,267,1086,20,1085],"class_list":["post-12381","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-main-tax-min","category-tax-savings","category-tax-news","tag-accounting","tag-accounting-professional","tag-amazon","tag-aws","tag-business-activities","tag-cfo","tag-colorado","tag-cpa","tag-cpe","tag-finance-professional","tag-government-state-agency","tag-irs","tag-rd","tag-research-and-development-credit","tag-research-credit","tag-tax","tag-tax-advisory-services","tag-tax-professional","tag-tax-regulations","tag-tax-updates","tag-taxation-changes"],"aioseo_notices":[],"jetpack_featured_media_url":"https:\/\/taxops.com\/wp-content\/uploads\/2023\/09\/Guidance-is-Out-on-\u00a7174.png","_links":{"self":[{"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/posts\/12381","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/comments?post=12381"}],"version-history":[{"count":6,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/posts\/12381\/revisions"}],"predecessor-version":[{"id":12391,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/posts\/12381\/revisions\/12391"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/media\/12387"}],"wp:attachment":[{"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/media?parent=12381"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/categories?post=12381"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/tags?post=12381"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}