Cutting-edge startups gain tax relief under bipartisan Walorski bill

U.S. Rep. Jackie Walorski (R-IN) on May 28 introduced bipartisan legislation that would provide startup businesses with advance refunds of certain net operating losses and research expenditures they missed out on under previous legislation Congress enacted during the ongoing COVID-19 pandemic. 

“I’m grateful to work across the aisle to boost small and mid-size businesses and drive innovation when we need it more than ever,” said Rep. Walorski.

The IGNITE American Innovation Act, H.R. 3623, which Rep. Walorski introduced with bill sponsor U.S. Rep. Dean Phillips (D-MN) and fellow original cosponsor U.S. Rep. John Curtis (R-UT), would allow small and mid-size businesses left out of the CARES Act to access fast and efficient capital to help accelerate the nation’s economic recovery, according to a bill summary provided by Rep. Walorski’s office.

“High-tech innovators like medical device manufacturers in northern Indiana will be vital to rebuilding our economy after the COVID-19 pandemic,” Rep. Walorski said. “Providing tax relief to cutting-edge startups is a commonsense way to ensure they can continue to develop life-saving technologies, discover treatments and cures, and create good jobs.” 

If enacted, H.R. 3623 would allow growth companies to monetize up to $25 million of accumulated net operating losses and R&D credits; and double the value of R&D credits generated by research into products to prevent, diagnose or treat COVID-19 and future pandemic threats, according to the bill summary.

H.R. 3623 has garnered support from the Medical Device Manufacturers Association, TechNet, the National Venture Capital Association, the Center for American Entrepreneurship, Technology Councils of North America, the Biotechnology Innovation Organization, and the Advanced Medical Technology Association.