Section 181
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Is Section 181, Film Federal Tax Incentive, “Dead” in a New Trump Administration?
Section 181, the Federal tax incentive spurring the production of film and television in the United States is about to suffer, reports David Robb at Deadline, “a quiet death” — at least for the time being. Filmmaker has covered Section 181 extensively, with Daniel J. Coplan’s article from last summer explaining in detail how the incentive benefits independent film producers and investors. In brief, it allows investors to deduct 100% of their investment against their Federal taxes in the year of the investment. That’s opposed to depreciating that investment over multiple years. For a high net work individual, that could […]
by Scott Macaulay on Dec 30, 2016 -
How To Talk to Your Investors about IRC Section 181
At Filmmaker we have covered Section 181, the United States’ film tax credit incentive, quite extensively, but this article by entertainment attorney Daniel J. Coplan, Esq. is both a great overview of how the incentive actually works for individual investors as well as an explanation of one underknown element. The latter concerns the ability of some investors to deduct against ordinary income, not passive income. In short, if you’re raising private equity for a U.S. film this year, read on. (This piece was originally published on LinkedIn and is reprinted with permission.) The purpose of this short article is to […]
by Daniel J. Coplan on Jul 15, 2016 -
Section 181, Film Production Tax Incentive, Reinstated (and Retroactive!) in 2016 Spending Bill
Great news for independent film producers: the omnibus spending bill passed by Congress this week and signed by President Obama contains a reinstatement of Section 181, the tax provision that incentivizes film and television production by allowing for immediate deduction of production costs up to $15 million. What’s more, the provision, which expires December 31, 2016, was made retroactive to include costs spent during 2015. (In recent years, Section 181 was retroactively renewed for the prior year at the beginning of the next fiscal year; in 2015, it was allowed to expire completely, and many observers didn’t expect to see […]
by Scott Macaulay on Dec 19, 2015 -
Will Film Production Tax Incentive Section 181 Die?
Tonight at midnight film investors and producers will be faced with a familiar uncertainty. Section 181, the portion of the American Jobs Creation Act of 2004 incentivizing U.S.-based film production, is set to expire, and independent filmmakers will lose a powerful tool in their fundraising arsenal. Section 181 encourages film investment by allowing investors to write off the complete cost of a qualified film in the first year. (Normally, this write-off is amortized, occurring in future years as a film demonstrates that it is money-losing. If and when profits then occur, they are treated as ordinary income by investors.) Scheduled […]
by Scott Macaulay on Dec 31, 2013 -
A 180 on 181
Nothing like a good fiscal crisis to get things moving in our federal government. After months of speculation and hand-wringing, the often misunderstood and underutilized Section 181 is back for producers, and it’s retroactive to 2012! Here are the specifics: The recently-enacted American Taxpayer Relief Act of 2012, which halted various tax increases scheduled to go into effect as part of the fiscal cliff, also retroactively extended the temporary rules for deducting certain film and television production expenses. The provision, Section 181 of the Internal Revenue Code, generally allows a deduction of up to $15,000,000 of the cost of a […]
by Brian Silikovitz Esq Christina Iafe Esq and Matt Savare Esq on Jan 11, 2013 -
Will The Section 181 Film Tax Incentive Be Extended?
The film tax incentive known as “Section 181” is due to expire at the end of this year, removing one enticement producers have been using to convince investors to finance independent feature films. Part of the American Jobs Creation Act of 2004, Section 181 allowed investors to write off the complete cost of a qualified film in the first year. (Normally, this write-off is amortized, occurring in future years as a film demonstrates that it is money-losing.) If and when profits then occur, they are treated as ordinary income by investors. At the close of 2009, Section 181 was similarly […]
by Scott Macaulay on Oct 25, 2011 -
Obama-Republican Tax Bill Includes Extension Of Film Tax Break Section 181
Filmmaker Justin Eugene Evans forwarded me news that an extension of Section 181, the film production tax break, was included in the bill signed by President Obama today. Here, reprinted with permission, is an email containing the news. Dear Film Professionals – Section 181 has finally been renewed! The new Tax Bill was signed into law by President Obama earlier today. The tax law includes Section 744, which includes language that replaces IRC Section 181’s expiration date of December 31, 2009 with December 31, 2011. Here is what this means: 1.) Any money spent on qualifying domestic film production* in […]
by Scott Macaulay on Dec 17, 2010
