Filmmakers seeking investors can offer them a federal tax credit that’s sprung back to life: Section 181, which permits a healthy 100% deduction for the cost of films, television shows, documentaries and other genres.
President Obama signed Section 181 into law effective through Dec. 31, 2011. The bill had been allowed to sunset on Dec. 31, 2009.
The Section 181 incentive was originally designed to thwart runaway film and television production, which took effect in October, 2004 as part of the American Jobs Creation Act.
It allowed filmmakers to offer their investors the benefit of deducting the cost of qualifying expenditures in the year they took place, instead of having to amortize them over a period of several years, explains Patty Fantasia of ScriptJournal Blog.
