One of Donald Trump’s signature campaign promises regarding tax reform is being proposed in Congress with the introduction of the ambitious bill entitled the “One Big, Beautiful Bill Act.” This multifaceted bill is designed to address a broad spectrum of issues vital to the nation’s well-being and economic future. After undergoing a series of comprehensive amendments, it was approved by the Budget Committee on May 18, 2025.

The bill includes significant changes to several key sectors, including:

Defense and Security: Enhance the nation’s defense capabilities by allocating resources for advanced military technologies and strengthening cybersecurity measures to protect critical infrastructure.
Borders: Implement comprehensive strategies to strengthen border security and promote efficient business practices that stimulate economic growth.
Education: Propose reforms to improve educational standards and increase access to resources for students and educators. Tax credits will be available for individual contributions to scholarship organizations, and qualified tuition programs will cover elementary, secondary, and homeschool expenses. Higher education expenses will also include tuition and costs related to recognized postsecondary credential programs.
Health: Implement innovative measures to enhance public health initiatives, improve access to quality health care, and significantly reduce the financial burden of medical expenses for families across the country. Employer-provided paid family and medical leave credits are expanded by giving employers the option to choose between credit for wages paid during the employee’s leave or credit for insurance premiums paid on policies that provide paid leave.
Taxation: Institute sweeping changes to the tax code aimed at simplifying compliance for individuals and businesses while fostering an environment that encourages investment and growth, both for American companies and foreign companies that want to invest in the USA.

In the Research and Development scenario, a key highlight of the proposed legislation is the suspension of the amortization requirement for domestic research and experimental expenses. Specifically, Section 174 is amended to include a new subsection (e) that suspends the application of required amortization for such expenses incurred in taxable years beginning after December 31, 2024, and before January 1, 2030.

Of particular significance for companies that invest in research and development (R&D) is the provision that allows these firms to deduct R&D expenses in the same tax year they are incurred, rather than spreading them over multiple years. This change aims to encourage innovation and R&D investment through fiscal year 2029, affecting a wide range of industries focused on technological advancement and scientific research. It also represents a significant step toward restoring the R&D Tax Credit to its original goal of stimulating domestic innovation.

In summary, the “One Big, Beautiful Bill Act” represents a comprehensive and ambitious approach to tax reform and strengthening essential sectors of the American economy. The suspension of the amortization requirement for research and experimental expenses is a significant highlight, aligning with principles of fiscal stability and fostering an environment conducive to economic growth. The Rules Committee meeting, scheduled for May 21, 2025, will be crucial to advancing this legislative proposal that could shape the country’s economic future.

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Tax Reform and Innovation: The Impact of the “One Big, Beautiful Bill Act”

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