Well the “good” thing about this law is that it also classifies ALL software development (and any supporting activities!) as R&D. And yes that’s as absurd as it sounds, but it’s true.
Bug fixing, for example, is not covered by Section 174.
It was always a sham. We were building product.
[0] This is based on working at a company that went through a brief period where we had to do extra tracking to be able to capitalize our time if it was possible, and then reading up on the matter to try and understand what the hell the purpose was. Possible I'm wrong about the matter--I've never been the one doing the finances.
The term generally includes all such costs incident to the development or improvement of a product.
What has changed is section 174 - previously all software development could be expensed (without any justification needed) and now it must be capitalized.