The IRS on Thursday issued transitional guidance on the One Big Beautiful Bill’s (OBBBA) amendments to the treatment of research or experimental (R&E) expenditures under IRC § 174, clarifying how taxpayers can change their method of accounting or accounting periods to reflect the removal of the amortization requirement for domestic research. (Rev Proc 2025-28; IRB 2025-38, 8/28/2025)
Revenue Procedure 2025-28, issued August 28, addresses the separation of domestic and foreign R&E expenditures, new elections, transition relief, and accounting method changes.
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