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Java IC in Gradle will not affect Kapt. Also I'm not sure if it can affect AP even without Kotlin and Kapt.
Annotation processing itself is not desinged to be incremental in a sense that Kapt/Apt cannot run annotation processors only on changed annotations, so all processors are always running from scratch.
Improvements can probably be made in building the model for AP in the new experimental Kapt, and we will definetely look into that in 1.1.x releases.
Bottom line: in a project with Kotlin + Kapt + Java, Gradle 3.4 Java IC improvements will only improve Java compilation times.