Press Releases

Today, Reps. Suzan DelBene (WA-01) and Jackie Walorski (IN-02), introduced the Furthering Our Recovery With American Research and Development (FORWARD) Act to provide expanded tax support for American companies that invest in the research and development (R&D) of new products and technologies.

The United States spends far less supporting R&D than its international competitors. This places American businesses at a disadvantage, undermining the U.S. economy and leaving the country ill-prepared for crises like COVID-19. 

"COVID-19 is having a devastating impact on our economy and draining resources for future innovations. To help spark the next generation of products and discoveries, and get our economy on track, we need to invest in research and development," said DelBene. "We need to unlock the full potential of the R&D Tax Credit by making it more accessible to smaller businesses."

“Our country is facing an unprecedented challenge, but I know we will emerge even stronger because of American innovation and entrepreneurial spirit,” said Walorski. “Boosting investment in research and development – including for new treatments and vaccines – will not only help in the fight against coronavirus, it will put America’s small businesses and manufacturers on the best path to rebuilding our economy.”

The FORWARD Act:

• Expands access to the R&D Tax Credit for new small- and medium-sized businesses. Firms with up to $20 million in gross receipts will be eligible to use the credit to reduce their payroll tax obligation during a span of 8 years—up from current thresholds of $5 million and 5 years. A new de minimis threshold delays the start of the 8-year window until gross receipts exceed $25,000.

• Strengthens the economy by incentivizing American manufacturing. The R&D Tax Credit is increased for companies that generate the majority of their gross receipts from manufacturing their products in the United States. 

• Targets specific activities that enhance economic productivity by spreading knowledge and work opportunities to the U.S. workforce. The full R&D Tax Credit is expanded to cover R&D-related worker training costs. For R&D performed in collaboration with industry consortia, academic institutions, federal laboratories, and other entities, the credit rate is increased by one quarter (to 25% and 17.5% for the Regular Research and Alternative Simplified Credits, respectively). 

• Activates the R&D Tax Credit by providing outreach, education, and training for businesses with limited accounting expertise, to be provided by the Small Business Administration and the Internal Revenue Service.

The companion bill in the Senate is led by Sens. Chris Coons (DE), Pat Roberts (KS), Catherine Cortez Masto (NV), Todd Young (IN), Maggie Hassan (NH), and Steve Daines (MT).

The bill text is available here and a one-pager on the bill is available here.