On "Section 174" and more on taxes from Hill, Barth & King LLC
at
https://hbkcpa.com/insights/proposed-tax-bill-addresses-trum...
is in part:
Jobs Act. The bill also addresses the
“big three” business tax provisions:
deducting research and development
expenses, 100% bonus depreciation,
and loosening the rules for the
deductibility of business interest.
deducting research and development
expenses
HBK
Home / Insights / Proposed Tax Bill Addresses Trump Campaign Promises and Expiring TCJA Provisions
Proposed Tax Bill Addresses Trump Campaign Promises and Expiring TCJA Provisions
Date May 15, 2025
Earlier this week, the House Ways and Means Committee released details of a multi-trillion-dollar tax-cut bill. The legislation closely follows President Donald Trump’s campaign promises of no tax on tips and overtime, tax breaks for seniors and car buyers, and extension of much of the expiring 2017 Tax Cuts and Jobs Act. The bill also addresses the “big three” business tax provisions: deducting research and development expenses, 100% bonus depreciation, and loosening the rules for the deductibility of business interest.
Key Provisions
(1) Permanent extension of individual income tax rates (no new millionaire’s tax rate)
(2) Permanent extension of the higher standard deduction with temporary increases for 2025 through 2028
(3) Additional $4,000 standard deduction for seniors (subject to income limitations)
(4) Estate and gift exemption increased to $15MM
(5) State and local tax deduction is increased from $10,000 to $30,000 (subject to income limitations)
(6) Child tax credit of $2,000 made permanent with an increase to $2,500 for 2025 through 2028
(7) Return of the $300/$600 above-the-line deduction for charitable contributions
(8) 100% bonus depreciation for assets placed in service after 1/19/25 and before 1/1/2030
(9) Full expensing of Section 174 domestic research and experimental expenses for 2025 through 2029
(10) Increase in the Section 179 deduction to $2.5MM with the phaseout beginning at $4MM
(11) Qualified business income deduction made permanent and increased to 23%
(12) Addition of a special deduction for “Qualified Production Property” which allows 100% depreciation for manufacturing buildings
(13) Eliminates many business, home and vehicle energy tax credits
(14) Creating a new round of Qualified Opportunity Zones with investor tax benefits
There is still substantial debate to come as this bill moves through Congress. We will continue to monitor developments and keep you updated on any changes that may affect your tax situation. Please contact HBK with any questions or to discuss how these potential tax changes might impact your specific financial circumstances.
So items (8) and (9) seem to have to do with deducting "depreciation for assets" and "Section 174".
And how does this all get paid for ? It doesn't.
It massively increases the deficit and debt which in turn will have a raft of knock on consequences for the economy and the reputation of the US.
Clearly "Section 174" is now, currently, an issue.
And vaguely I seemed to remember some Trump campaign statements that in taxes some business spending could be deducted instead of amortized (spread over several years) or some such.
I'm deliberately no expert on taxes or business taxes.
Some of the Internet discussions seemed to suggest that some of the worst of 174 were to be implemented, continued, canceled, whatever, so for more information on the background, status, future, etc. of 174, did a little Google search and came up with the discussion I posted here. That discussion seems to say that the "Big Beautiful Bill" may get rid of 174, and that would seem to be in the collection of deduction changes Trump discussed.
About the economy, growth, the Fed's Prime rate, deficit spending, interest payments on Treasury bonds, tariffs, inflation, the balances of trade and payments, R&D, AI, foreign investment in the US, 174, etc., to me the MSM (mainstream media) is short on enough credible information for me to have much in opinions.
In addition, for politics, mostly it looks like noise for some manipulation, effect, or other and a reason to follow "Always look for the hidden agenda."
So, about 174, the information I have looks no more credible and a lot less fun than an old Bugs Bunny cartoon! But maybe Bugs Bunny or Elmer Fudd would guess that getting rid of 174 would help R&D, new businesses, factories, business revenue, and even, net, tax revenue. Or did Elmer repeat "To make money, have to spend money."?
I'd scream at the junk -- drama -- in the MSM, but it won't do any good.
Summary: For the main issues here in the US, I just don't have good information. The stuff I posted above seems to suggest that the future of 174 is still in doubt.