PAYC · 10-Q · 2026Q3 · Full report

U.S. Tax Law Changes

Paycom Software, Inc. · 2026-11-05 · Importance 47 · Surprise 60

On July 4, 2025, H.R. 1, the One Big Beautiful Bill Act (OBBBA), was signed into law, amending the U.S. tax code. Its immediate deduction for domestic research and development expenditures and reinstatement of 100% bonus depreciation reduced Paycom’s cash tax remittances in the second half of 2025 and the first nine months of 2026, favorably affecting operating cash flows. Management expects these provisions to continue benefiting cash flows in future periods, but to a lesser extent.

Key facts

• Paycom said the OBBBA’s immediate deduction for domestic R&D expenditures and reinstated 100% bonus depreciation reduced cash tax remittances in the second half of 2025 and first nine months of 2026, favorably affected operating cash flows, and is expected to continue benefiting future periods to a lesser extent. source