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- 23 February 2013 /
- by zoetifex Studios /
U.S. Tax Code 181 was originally drafted as part of The American Jobs Creation Act Of 2004 as a way to keep filming production companies from going up to Canada and elsewhere to film their movies and TV shows.
Last year, it was rolled into the American Taxpayer Relief Act of 2012 (The Stimulus plan). What it does, is it allows an investor to get a 100% deduction on their taxes as long as the production company is spending 70% of their finances in the US and that the cost of production is $15M or less ($20M with some provisions).
This acts just like giving to charity only better. What it also does is gives the investor a 9% tax break on any revenue generated from that investment. So for every $100k that someone invests into a project, they get a $35k tax break (figuring that they would probably be at the 35% tax bracket). And for every $100k they make on the invested project, they save $9k in taxes.
We think this is a huge deal!
With the tax breaks and potential revenue, this should be worth a look for anyone who has the ability to invest.