U.S. Sens. Todd Young (R-IN) and Maggie Hassan (D-NH) recently introduced legislation that would support research and development (R&D) investments by startups and innovative companies.
Currently, businesses and startups investing in R&D can claim tax incentives that help them to invest in developing new, innovative products. This proposed legislation, the American Innovation and Jobs Act, would expand the refundable R&D tax credit and ensure that businesses can fully deduct R&D expenses each year.
“Maintaining and encouraging R&D activities here in the United States is critical to providing high-quality jobs for Americans and ensuring our country remains competitive with our international rivals, most notably China,” Young said. “Our American Innovation and Jobs Act would ensure businesses can fully deduct R&D expenses each year and expand the R&D tax credit for startups and small businesses.”
Specifically, the bill would restore incentives for long-term R&D investment by ensuring that companies can fully deduct R&D expenses each year; raise the cap for the refundable R&D tax credit for small businesses and startups; and expand eligibility for the refundable R&D tax credit so that more startups and new businesses can use it.
“When American companies invest in research and development to develop new products and technologies, it stimulates our economy, promotes job growth, and helps us compete with foreign adversaries,” said Senator Hassan. “I was proud to lead the effort to double the R&D tax credit for small businesses and startups in the Inflation Reduction Act and am continuing the push with Senator Young to further expand these tax incentives. Our bipartisan bill will help more startups and businesses invest in research and development and also ensure that they can fully deduct research and development expenses each year,” Hassan said.