U.S. Sen. Tammy Baldwin and a group of her colleagues reintroduced the American Innovation and Jobs Act, bipartisan legislation that will expand and strengthen American small businesses’ research and development (R&D) investments and help America outcompete global rivals, like China, who are significantly investing in R&D.
Specifically, the American Innovation and Jobs Act would help businesses innovate and create jobs by:
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Restoring incentives for long-term R&D investment by ensuring that companies can continue to fully deduct R&D expenses each year by repealing the change made by the Tax Cuts and Jobs Act to section 174 of the tax code;
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Expanding support for innovative startups by doubling the cap on the refundable R&D tax credit from $250,000 to $500,000 — raising it to $750,000 over ten years — and expanding access to the R&D tax credit for startups by lowering certain thresholds needed to qualify; and
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Expanding the number of startups eligible to use the refundable R&D credit by increasing the eligibility threshold from $5 million to $15 million in gross receipts and broadening the period during which startups can claim the credit from five years to eight years after beginning to generate at least $25,000 in revenue.
The full text of the bill is available here.
