Staying current this fall, CPAs must act fast. Revenue Procedure 2025-28 unlocks new pathways for handling research & experimental (R&E) expenditures under the OBBBA, with important elections and extension relief. This blog shows how Hive Tax’s AI tax research and planning tools can streamline analysis and execution—get compliant, get efficient. Read on and plan your next steps!
1. What’s New: Revenue Procedure 2025-28 Overview
- Issued August 28, 2025, the IRS released this procedural guidance to implement the One Big Beautiful Bill Act (OBBBA), affecting R&E expenditures under IRC §§ 174, 174A, and 280C.
- It clarifies changes in accounting methods, how to make elections, and how to file superseding or amended returns to retroactively apply new rules.
2. Key Provisions and CPA Takeaways
A. Small Business Retroactive Elections
- Eligible small businesses (those with ≤ $31 million in average gross receipts for 2022–2024) can retroactively apply Section 174A dating back to 2022.
- If they timely deduct domestic R&E on the 2024 return and meet requirements, they’re deemed to have made the retroactivity election with a statement “FILED PURSUANT TO SECTION 3.03 OF REV. PROC. 2025-28”.
- Deadline: July 6, 2026, or the applicable refund statute of limitations—whichever is earlier.
B. Options for All Taxpayers
- For domestic R&E incurred in tax years beginning after Dec 31, 2024, taxpayers can:
- Deduct immediately under Section 174A(a), or
- Capitalize and amortize over at least 60 months under Section 174A(c), or over 10 years under amended Section 59(e).
- Deduct immediately under Section 174A(a), or
- Foreign R&E continues to be amortized over 15 years.
- Rev. Proc. 2025-28 also provides election options for handling unamortized domestic R&E incurred 2022–2024, either fully expensed in the first year after Dec 31, 2024, or ratably over two years.
C. Superseding Return Relief
- Taxpayers who already filed their 2024 returns but want to make elections under this guidance may file a superseding return with “REVENUE PROCEDURE 2025-28” written at the top to get an automatic six-month extension.
3. CPA Checklist This Fall
| Step | Action Item |
| 1 | Identify clients with R&E activity from 2022–2024. |
| 2 | For small business clients (≤ $31M receipts), evaluate retroactive election impact. |
| 3 | Model immediate expensing vs amortization under 174A for 2025+. |
| 4 | Prepare necessary election statements for returns. |
| 5 | File superseding returns for 2024 if advantageous—don’t miss the 6-month extension. |
4. Speed Up with Hive Tax AI Research & Planning Tools
How Hive Tax empowers CPAs this season:
- AI-powered tax research: Quickly retrieve detailed guidance on Rev. Proc. 2025-28, Section 174A options, election procedures, and filing relief—all with precise search terms and up-to-date insights.
- Scenario modeling: Automatically compare tax outcomes of immediate deducting vs amortizing R&E expenses, and simulate retroactive elections’ refund potential.
- Document generation: Instantly draft required election statement language (“FILED PURSUANT TO SECTION 3.03…”, or “REVENUE PROCEDURE 2025-28” on superseding returns) correctly formatted.
- Deadline alerts: Hive AI tracks key dates—like the November 15 deemed election deadline and July 6, 2026 amendment cutoff—to keep you compliant.
- Workflow integration: Seamlessly insert research memos, worksheets, and client deliverables into your existing tax workflow.
Together, this enables CPAs to navigate Rev. Proc. 2025-28’s complexities faster, more accurately, and with stronger client outcomes.
Conclusion
This fall’s Revenue Procedure 2025-28 presents both a challenge and an opportunity. Whether you’re optimizing R&E treatment or unlocking retroactive tax benefits, the clock is ticking—and clarity is essential.
Hive Tax AI tools give CPAs the power to research, plan, model, and document at lightning speed. Ready to streamline your 2025 R&E strategy and deliver results to your clients?
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