Countdown Is On: Expect 47 Days to Act on Retroactive R&D Expensing*

Your Implementation Guide to the One Big Beautiful Bill

*Based on IRS standard practice; pending formal guidance.

With the One Big Beautiful Bill now signed into law, businesses and advisors must act quickly to capitalize on its new provisions—especially if the IRS adopts the expected 47-day window for retroactive R&D expensing. This guide outlines the key updates and immediate action steps to consider.

Key Implementation Areas

Section 174A R&D Expensing Permanently Restored

• Applies to tax years beginning after January 1, 2025
• Taxpayers may elect:
  • Full deduction in the year incurred
  • 10-year amortization
  • 60-month recovery period
• The IRS has authorized an automatic method change (no Form 3115), but timely elections and proper return preparation remain essential

47-Day Retroactive Window for Small Businesses*

• Eligibility: Businesses with under $31 million average gross receipts
• Relief: Amend 2022 and 2023 returns to claim full R&D expensing
• Deadline: Based on the IRS’s standard practice for retroactive tax provisions, ABGi is moving forward with a 47-day window, beginning July 4th and ending on August 19, 2025
• This is a critical, time-sensitive opportunity for potential refunds and cash flow optimization
• While the statute does not define a specific time window, the 47-day period is consistent with prior IRS practice for retroactive provisions—and serves as a reasonable timeline for planning and filing.
• ABGi is actively monitoring for IRS and Treasury guidance and will provide timely updates if the official amendment window or procedures change.

Planning Options for Larger Businesses

• Eligible to elect full expensing or amortization under the new Section 174A framework
• Important to model and compare tax outcomes under each option
• Begin preparing now for full implementation in 2025

Additional Provisions to Monitor

• Section 179D phase-out begins for buildings starting construction after June 30, 2026
• SALT deduction cap raised temporarily to $40,000 through 2030
• 100% bonus depreciation extended through 2029 for qualified property
• IRS and Treasury guidance expected in Q3 and Q4 of 2025

Action Checklist (Target Deadline: Mid-August)

What This Means Now

The next several weeks are pivotal for tax and financial strategy. Whether you’re a small business eligible for immediate retroactive benefits or a larger firm preparing for 2025, the time to act is now.

We know what the law permits—but how to file and when to act still depends on forthcoming IRS guidance. Based on prior precedent, we anticipate a 47-day amendment window, ending around August 19, 2025, for eligible small businesses.

ABGi is proactively preparing for this timeframe and will update clients immediately once the IRS releases formal instructions. Until then, we’re helping businesses model outcomes, prepare documentation, and return preparation under the new law.

ABGi’s R&D team is ready to assist.

Schedule an Appointment with a R&D Specialist Now. 

📩 Stay Ahead of Tax Policy Shifts
Not on our update list? Sign up here to receive ABGi’s insights directly in your inbox.