Comment by patmcc
2 years ago
Exactly. And I do think the truth lies somewhere in the middle - some software development creates capital assets, but lots does not.
And either way it's very painful to change the rules entirely in a single tax year, especially for small businesses. FAANG companies will weather this either way, but it could kill small software businesses.
agreed. It is quite backbreaking if you dont have a huge bucket of money.
One alternative if it must be treated as a capital asset is to allow accelerated/immediate depreciation for small firms and individuals.
I can see the point that for large firms like with diversified R&D portfolios, development, on average, results in creation of capital assets.
For small firms, it is absolutely unclear that the product has any durable value at all.