IRS Rules Detail Company Compliance With R&D Expense Change (2)

The IRS issued accounting guidance for research and development expenditures Monday.

The agency released Rev. Proc. 2023-8, detailing how companies should implement the new accounting method under Section 174, which changed as a result of a provision in the 2017 tax reform law that requires companies to amortize their R&D costs over five years in 2022.

Companies that filed returns after Dec. 31, 2021, but on or before Jan. 9, 2023, will have complied with the Section 446 method change, according to the procedure.

Monday’s guidance indicates that the TCJA’s amendment to ...