Press Releases

Today, Representatives Suzan DelBene (WA-01), Jimmy Panetta (CA-19), Greg Steube (FL-17), and Mike Thompson (CA-04) led an effort expressing concerns about reports that Meta is seeking to use the federal research tax credit for its data center buildout. In a bipartisan letter to Treasury Secretary Scott Bessent, the lawmakers emphasized that any claims by Meta for the federal research tax credit must meet the clearly defined requirements.

Congress established this tax credit in 1981 amid concerns about declining private-sector research investment and U.S. global technological competitiveness. By reducing the cost of qualifying research, the credit is meant to encourage businesses to pursue projects involving technical uncertainty and experimentation, rather than simply purchasing and deploying proven technology.

“We are concerned by Meta’s apparent position that expenditures associated with its massive data-center buildout qualify for the research credit,” wrote the lawmakers. “The purchase and deployment of commercially available servers, networking equipment, electrical infrastructure, cooling equipment, and other proven technologies cannot be transformed into qualified research merely because they are installed at unprecedented scale or in new configurations.”

To qualify for the credit, research must meet a four-part test, including being technological in nature, addressing technical uncertainty, seeking to develop or improve a product or process, and involving a process of experimentation. Certain activities, including research conducted after commercial production begins and duplication of an existing product or process, are excluded. The lawmakers emphasized that the scale or configuration of a data center does not, by itself, establish that its construction and equipment costs qualify.

“Allowing ordinary data-center construction and deployment costs to qualify would significantly expand the research credit beyond its intended purpose and risk converting an incentive for technological experimentation into a subsidy for capital expenditures that companies would undertake in the ordinary course of business,” continued the lawmakers.

“The research credit is an important tool for promoting American innovation. Protecting its integrity requires ensuring that it rewards genuine research and experimentation rather than subsidizing routine capital investment,” concluded the lawmakers.

The letter was also signed by Representatives Yassamin Ansari (AZ-03), Nanette Barragán (CA-44), Donald Beyer (VA-08), Joe Courtney (CT-02), Sharice Davids (KS-03), Danny Davis (IL-07), Veronica Escobar (TX-16), Sylvia Garcia (TX-29), Adelita Grijalva (AZ-07), Val Hoyle (OR-04), Jared Huffman (CA-02), John James (MI-10), Greg Landsman (OH-01), Kristen McDonald Rivet (MI-08), Kevin Mullin (CA-15), Chris Pappas (NH-01), Andrea Salinas (OR-06), Hillary Scholten (MI-03), Terri Sewell (AL-07), Victoria Spartz (IN-05), Lori Trahan (MA-03), and Nikema Williams (GA-05).