On May 20, 2015, the House of Representatives passed a measure that would extend the IRC Section 41 Research Credit. The bipartisan vote totalled 274 to 145. The measure aims to make the credit a permanent feature of the tax code. In order for this bill to pass the Senate, however, some means will have to be found to offset the estimated $180 billion cost that is expected to accrue over the next ten years.
The research credit has a long history, dating back to 1981 when it was enacted in an effort to bolster domestic investment in experimental development efforts here in the United States. Due largely to Senate budget rules, it has always been provided on a temporary basis. It has expired and been retroactively reinstated more than a dozen times over the past 34 years. The most recent expiration took effect on December 31, 2014.
The research credit has clearly helped to generate more spending on technical development efforts here at home over many years, and it enjoys broad bipartisan support in both houses of Congress. The net result has been to help keep engineering and manufacturing jobs here that otherwise would have gone overseas. If you support this program, please contact your Senators and urge them extend the Section 41 Research Credit.
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