Eligibility
Applies to productions where 75% of compensation is for services in the US; includes sound recordings up to $150,000. Valid for productions commencing before December 31, 2025.
Frequently Asked Questions
Who is eligible for the Accelerated Expensing for Film, TV, and Live Theater?
Applies to productions where 75% of compensation is for services in the US; includes sound recordings up to $150,000. Valid for productions commencing before December 31, 2025.
How does the Accelerated Expensing for Film, TV, and Live Theater work?
Allows an immediate deduction for the first $15 million ($20 million in distressed areas) of production costs for qualified films, television series, and live theatrical productions.
What law authorizes the Accelerated Expensing for Film, TV, and Live Theater?
The Accelerated Expensing for Film, TV, and Live Theater is authorized under IRC §181 of the Internal Revenue Code (Title 26, United States Code).
Statutory Text — IRC §181
Source: Internal Revenue Code, Title 26, United States Code
§ 181. Treatment of certain qualified productions(a) Election to treat costs as expenses(1) In generalA taxpayer may elect to treat the cost of any qualified film or television production, any qualified live theatrical production, and any qualified sound recording production as an expense which is not chargeable to capital account. Any cost so treated shall be allowed as a deduction.
(2) Dollar limitation(A) In generalParagraph (1) shall not apply to so much of the aggregate cost of any qualified film or television production or any qualified live theatrical production as exceeds $15,000,000.
(B) Higher dollar limitation for productions in certain areasIn the case of any qualified film or television production or any qualified live theatrical production the aggregate cost of which is significantly incurred in an area eligible for designation as—(i) a low-income community under section 45D, or
(ii) a distressed county or isolated area of distress by the Delta Regional Authority established under section 2009aa–1 of title 7, United States Code,
subparagraph (A) shall be applied by substituting “$20,000,000” for “$15,000,000”.
(C) Qualified sound recording productionParagraph (1) shall not apply to so much of the aggregate cost of any qualified sound recording production, or to so much of the aggregate, cumulative cost of all such qualified sound recording productions in the taxable year, as exceeds $150,000.
(b) No other deduction or amortization deduction allowableWith respect to the basis of any qualified film or television production, any qualified live theatrical production, or any qualified sound recording production to which an election is made under subsection (a), no other depreciation or amortization deduction shall be allowable.
(c) Election(1) In generalAn election under this section with respect to any qualified film or television production, any qualified live theatrical production, or any qualified sound recording production shall be made in such manner as prescribed by the Secretary and by the due date (including extensions) for filing the taxpayer’s return of tax under this chapter for the taxable year in which costs of the production are first incurred.
(2) Revocation of electionAny election made under this section may not be revoked without the consent of the Secretary.
(d) Qualified film or television productionFor purposes of this section—(1) In generalThe term “qualified film or television production” means any production described in paragraph (2) if 75 percent of the total compensation of the production is qualified compensation.
(2) Production(A) In generalA production is described in this paragraph if such production is property described in section 168(f)(3).
(B) Special rules for television seriesIn the case of a television series—(i) each episode of such series shall be treated as a separate production, and
(ii) only the first 44 episodes of such series shall be taken into account.
Showing first 3,000 characters of full section text.