Comment by adrr
3 years ago
Something is getting lost translation here. You can capitalize certain projects of that meet a certain threshold. I can't capitalize something as trivial as changing some colors. The capitalization is based on the expected lifespan of deliverable. Web pages is like 2 years. Bug fixes/maintenance, and project management are not capitalizable and its common to use 80/20. Public companies want to capitalize everything to improve earnings and kick up their stock price but they are kept in check by auditors.
How is this going to change?
As it relates to developer salaries, you don't have an option to decide if you're going to capitalize or immediately expense. With this bill, you must amortize over five years.
You're talking about deciding whether or not to capitalize a laptop, a piece of equipment, a vehicle, etc, and over what period. There's lots of guidance for that. This is very specifically affecting the salaries you pay software developers.
I just figured out the disconnect. This is only for tax reporting and not financials. This is going to be fun.
Real estate has this same problem but 10x as bad.