¹TD 8930 (1/29/01).

²Notice 2001-19, IRB 2001-10, 784.

³REG-112991-01 (12/26/01).

⁴Treasury News Release PO-871 (12/14/01).

⁵As of 1992, 75%; see U.S. Congress, Office of Technology Assessment, The Effectiveness of Research and Experimentation Tax Credits (1995)(hereinafter, "Technology Report"), p. 18, at http://www.wws.princeton.edu/~ota/ns20/year_f.html . See also Joint Committee on Taxation, Description of Revenue Provisions Contained in the President's Fiscal Year 2000 Budget Proposal (JCS-1-99, 2/2/99)(hereinafter, "JCT Report"), p. 119.

⁶As of 1992, 70% of the credit; see Technology Report, note 6 supra, at p. 19. See also JCT Report, note 5 supra, at p. 120.

⁷Technology Report, note 5 supra, at p. 19.

⁸Salaries were 62% of qualified research expenses (QREs) claimed for the credit; see id.

⁹The AIRC has three fixed rates: 2.65%, 3.2% and 3.75%. The AIRC is the sum of 2.65% of QREs between one and 1.5% of AAGR, plus 3.2% of QREs between 1.5 and two percent of AAGR, plus 3.75% of such expenses above two percent of AAGR.

¹⁰U.S. Congress, Testimony of William Sample, Chairman, R&D Credit Coalition, before the House Ways and Means Committee's Oversight Subcommittee's Hearing on the Tax Code and the New Economy (9/28/00)(hereinafter cited as "Sample Testimony").

¹¹See Guenther, The Research and Experimentation Tax Credit, Congressional Research Service Issue Brief No. 92039 (8/10/99), p. 1.

¹²For a comprehensive table of the R&E credit structure from 19811995, see Technology Report, note 5 supra, p. 10, Table 1.

¹³TD 8251 (5/16/89).

¹⁴REG-105170-97 (12/2/98).

¹⁵Sample Testimony, note 10 supra, at Part III.

¹⁶H. Rep't No. 106-478, 106th Cong., 1st Sess. (1999), p. 132.

¹⁷Sample Testimony, note 10 supra, at Part III.

¹⁸See Prop. Regs. Sec. 1.41-4(a)(5) (12/2/98).

¹⁹Tax and Accounting Software Corp., 111 FSupp2d 1153 (DC OK 2000).

²⁰See Prop. Regs. Sec. 1.41-4(c)(3) and (4), Sec. 41(d)(3)(B) and Prop. Regs. Sec. 1.41-4(a)(5)(iii).

²¹This an expansion from the 1998 proposed regulations, which had excluded Puerto Rico and U.S. possessions.

²²See Regs. Sec. 1.41-4(a)(3)(i); and Prop. Regs. Sec. 1.41-4(a)(3) (12/2/98).