Only properly allocable costs are charged, and not interest or research
What the document says“expenses and deductions (including taxes), other than interest expense and research or experimental expenditures, properly allocable to such gross income.”
The section rewrites section 250(b)(3)(A)(ii) of the Internal Revenue Code of 1986 so that only expenses and deductions, including taxes, properly allocable to the gross income are charged against it, and not interest expense or research or experimental expenditures.
What the document actually says“expenses and deductions (including taxes), other than interest expense and research or experimental expenditures, properly allocable to such gross income.”
Costs are charged against the income only if they belong to it. Interest and research costs are left out.
Taxes are among the costs that may be charged. The rule narrows what may be counted. That raises the income figure.
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