… the original cast are all over 70 years old 
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Brilliant, there just aren’t enough likes in the world for that!
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Sony is one step away from making a movie about Aunt May’s origin story (with no mention of Peter Parker, of course).
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They could just adapt Mark Millar’s awful comic Trouble, about how Peter Parker is actually Aunt May’s son…
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I’m pretty firmly in the boat that if you are permanently pulling a movie from public release for a tax benefit, you should lose copyright protection for the film. The point of copyright is to promote the arts and the studio has declared that they have no financial gains they make from controlling it.
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Oh. She is clever. Her web will save that piglet.
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Make it public domain.
You want the public to give you a tax break for your shelved project? Fine, but now we own it.
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So what happens to the actors who get their pay as a percentage of gross profits? They get nothing?
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I mean, it worked for Enron and Arthur Anderson… until they got caught.
Probably, so it’s a too-fer: you get to ALSO screw over the talent that helped make your tax dodge! /sarcasm
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The original cast? You bet. However, the current cast, with the exception of Fred Welker, are not.
Fred Welker: 77
Matthew Lillard: 53
Grey DeLisle: 50
Kate Micucci: 43
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They immediately recoup the cost of the movie without having to spend anything for marketing which, obviously, increases the total cost of the movie in the first place.
It makes sense, I’m just not certain how deciding to not release a film allows them to write it off their books… and I AM a tax expert.
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… assuming that huge sums of money were actually involved. The way that Hollywood has in the past cheated on shared profits (and of the “skills” acquired thereby), I wonder how much jazz their accountants would have to play in order to successfully hide actual costs. (Trump property value vibe here.)
Also, would it be beyond possible for Warner to fund a no-winner just for the purposes of shelving it?
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… from whom?
or, what does “recoup” mean
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I’m 100% for that as long as Marisa Tomei is brought back for the role.
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Recoup: to get an equivalent for (losses)
They immediately write off the full cost off the movie. See, normally when money is invested and spent on making a film, it isn’t an expense. It is an investment in an asset. The movie then remains on the books until it is used or sold. When the asset is used or sold, it is depreciated, which means the asset’s value is lowered systematically over a number of years, and an expense is recognized.
This instead allows them to avoid needing to depreciate the movie and take it all at once as an expense.
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… so that instantly reduces their taxable income, but it’s not cash they can spend on something else
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Correct. That is the thing about a deduction, you must spend the money first. However, it does greatly accelerate the deduction by 5 years - which can make the books look a bit better come tax time. It also would allow for expensing acquiring the script or film rights by 15 years.
Of course, and here is the rub, the IRS can claim that the film was not a for-profit endeavor. If that is the case, then no deduction is allowed at all.
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… so beyond only getting part of the money back (the amount of the tax), writing it all off at once would increase the taxable income for future years, since it would have been taken as a deduction in pieces over that time?
It just sounds like it’s only marginally beneficial, not the lottery prize people make it out to be
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