Lifting the Curtain on Tax Codes

Today president Barack Obama signed into law a package that establishes equal tax treatment for live theatrical productions. The bill levels the playing field between New York-based theatrical productions and film and television shows. Current tax codes allow TV and film productions to expense up to $15 million in qualified costs, when 75 percent of compensation paid is for services performed in the United States. Broadway shows and other live theatrical productions did not previously qualify for the tax incentive.

Additionally, prior to this legislation, Broadway investors were required to anticipate financial liability by creatively predicting a show’s duration and income, which, in many cases, resulted in tax payments on unseen “profits” before producers earned back their initial investment. This new law allows 100 percent of an investment to be deducted by the investor from his or her income in the year of the investment. This is incredible news as it is now more enticing than ever to invest in one of the most exciting and dynamic businesses in the world, live theatre. .

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