Of these, the Section 174 debacle (software R&D amortization) is arguably the problem that needs to be addressed most urgently.
I'm not convinced that this wasn't the intent of the change in the first place.
Except you don't have $800k. You have $0k.
When combined with:
- Pressure to make use of office spaces again, away from remote work
- The AI bubble
- The layoffs that started before section 174 that demonstrated how headcounts had inflated
- The collapse of Silicon Valley Bank last year
... it is not looking good for software engineers in the US.
(Better for the US engineers, not for the Guatemalan, who is probably a competent engineer himself. But the topic is the outlook for US engineers).
Bootstrapping a tech company in a post Section 174 world doesn’t even seem feasible. I can’t believe this issue isn’t being taken more seriously.
Does it even impact these type of companies? 90% of the time at this stage you'll have very little income compared to expenses.
Why do you speculate that number? With $1M in revenue and $1.2k in profit, there must have been $998.8k in expenses. I assume "pay yourself" was part of the $998.8k. But I don't know the answer to the other part of your question: I don't know if the $90k in taxes are included in the $998.8k expenses.