On December 18th of 2015, President Obama signed into law the Protecting Americans from Tax Hikes Act of 2015 (hereinafter the “PATH Act”) which expanded the scope and application of the I.R.C. § 181 deduction for Qualified Film and Television Production expenditures to now encompass Live-Theatrical Productions. The PATH Act also extended this highly advantageous tax incentive through December 31, 2016.
The PATH Act truly enables a level playing field between live-theatrical productions and film and television productions in connection to the tax incentives available for the entertainment industry. Robert E. Wankel, Chairman of The Broadway League in a prepared statement indicated: “The Broadway and Touring Broadway industries have a combined economic impact of more than $15 billion dollars on the nation’s economy and employ tens of thousands of people in the U.S. and around the world, yet we are still very much made up of small businesses that actively seek financing from individual investors. This relatively small amendment to the Tax Code will have a tremendous impact on the theatre business by eliminating one of the largest challenges that producers face when trying to attract capital for what is always a highly risky endeavor. We applaud Senator Schumer, as well as the members of the Ways and Means and Finance Committees, for their extraordinary efforts and recognition of the financial and cultural impact of live entertainment.”
Please contact me to discuss the scope and application of the PATH Act and how movie production tax incentives can be utilized to properly tax effect the production costs for live-theatrical productions, as well as for movie and television productions.
A copy of the PATH Act can be downloaded for your reference at:
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