If it's software, you do need to amortize 100%. Section 174 (as amended by the TCJA) has specific language to this effect [1]:
> For purposes of this section, any amount paid or incurred in connection with the development of any software shall be treated as a research or experimental expenditure.
i.e. it needs to be amortized. That's the part that people find most objectionable -- software development is special-cased for unfavorable tax treatment that does not apply to other fields.
I firmly believe 174 has to be repealed. Like many bills and regulatory overreach in the US, 174 does not promote and support entrepreneurship, risk-taking, investment, etc.
All I am saying in my prior comment is that clever treatment of your engineering costs can improve tax outcomes. We have done just this --under the guidance of our tax attorneys-- and have had no problems at all.
Of course, a company that is a pure software enterprise and not multi-disciplinary, like us, is, well screwed.
Keep in mind that at year 6 you are effectively deducting your full R&D costs, even for a pure software company. The real cost is the TVM due to the phase shift, at year six you reach steady state (assuming steady costs).
> For purposes of this section, any amount paid or incurred in connection with the development of any software shall be treated as a research or experimental expenditure.
i.e. it needs to be amortized. That's the part that people find most objectionable -- software development is special-cased for unfavorable tax treatment that does not apply to other fields.
[1] https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim...