§ 174.
(a)
In general
In the case of a taxpayer’s foreign research or experimental expenditures for any taxable year—
(1)
except as provided in paragraph (2), no deduction shall be allowed for such expenditures, and
(2)
the taxpayer shall—
(A)
charge such expenditures to capital account, and
(B)
be allowed an amortization deduction of such expenditures ratably over the 15-year period beginning with the midpoint of the taxable year in which such expenditures are paid or incurred.
([Aug. 16, 1954, ch. 736], [68A Stat. 66]; [Pub. L. 94–455, title XIX], §§ 1901(a)(30), 1906(b)(13)(A), Oct. 4, 1976, [90 Stat. 1769], 1834; [Pub. L. 97–248, title II, § 201(d)(9)(B)] formerly § 201(c)(9)(B), Sept. 3, 1982, [96 Stat. 420], renumbered § 201(d)(9)(B), [Pub. L. 97–448, title III, § 306(a)(1)(A)(i)], Jan. 12, 1983, [96 Stat. 2400]; amended [Pub. L. 99–514, title VII, § 701(e)(4)(D)], Oct. 22, 1986,