Sure, foreign R&D still gets amortized over 15 years (NPV ≈59 % of a full write-off, so you “lose” ~8.6 % of your R&D spend in present-value terms, and only 6.7 % of the cost is deductible in year 1, creating a 19.6 % cash-tax gap). But offshore wages are often 50–70 % below U.S. rates:
• Even after the slower amortization drag, hiring at half the cost nets you ~30 % total savings on R&D headcount.
• On a pure cash basis you only need ~20 % lower wages to break even; most offshore markets easily exceed that.
• So the labor-cost arbitrage far outweighs the tax timing penalty unless your foreign salaries are less than ~20 % below U.S. levels.
In short: the 15-year amort rule hurts your tax deduction, but 50 %+ lower offshore wages more than make up for it.