Meta has classified its AI data centers as experimental projects to leverage the One Big Beautiful Bill Act, signed in 2025. Under IRC Section 174A, this allows the company to deduct research and experimental costs immediately, rather than amortizing them over several years as previously required.
The company's federal tax expense fell from $9,6 billion in 2024 to $2,8 billion in 2025, representing a 71% decrease. This occurred despite capital expenditures of roughly $72 billion, primarily directed toward AI infrastructure and data center construction.
One major project, the Hyperion campus in Louisiana, is planned to reach 5 gigawatts of capacity with investments exceeding $50 billion. Meta uses joint ventures to limit its long-term financial exposure, though the Union of Concerned Scientists warns this could shift costs to local utility customers.
Senator Elizabeth Warren and other lawmakers sent inquiries to Meta on September 27–28, 2026, regarding these tax deductions. The company is already involved in separate tax disputes with the IRS concerning international structures and transfer pricing, which involve billions of dollars.
