Layoff

Since 1954, US companies were able to fully deduct R&D expenses in the year they were incurred. This regulation encouraged technological innovation and employment in the United States. The TCJA modified this provision (Section 174). From 2022, R&D expenses must be amortized over 5-15 years, which reduced R&D investment tax benefits and increased incentives for layoffs. In fact, mass layoffs began occurring from 2023.