I 

113TH CONGRESS 

2D SESSION H. R. 5497 

To amend the Internal Revenue Code of 1986 to modify and extend the 

election to expense the cost of qualified film, television, and theatrical 

productions. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 16, 2014 

Mr. PETERSON introduced the following bill; which was referred to the 

Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to modify 

and extend the election to expense the cost of qualified 

film, television, and theatrical productions. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Film Incentive Reform 

5 Act of 2014’’. 


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1 SEC. 2. MODIFICATION AND EXTENSION OF ELECTION TO 

2 EXPENSE THE COST OF QUALIFIED FILM, 

3 TELEVISION, AND THEATRICAL PRODUC4 TIONS. 

5 (a) EXTENSION.—Section 181(f) of the Internal Rev6 enue Code of 1986 is amended by striking ‘‘December 31, 

7 2013’’ and inserting ‘‘December 31, 2015’’. 

8 (b) MODIFICATION OF QUALIFIED FILM, TELEVISION

9 AND THEATRICAL PRODUCTIONS TO WHICH SECTION AP10 PLIES.— 

11 (1) IN GENERAL.—Section 181(d) of such Code 

12 is amended to read as follows: 

13 ‘‘(d) QUALIFIED FILM, TELEVISION, OR THEATRICAL

14 PRODUCTION.—For purposes of this section— 

15 ‘‘(1) IN GENERAL.—The term ‘qualified film, 

16 television, or theatrical production’ means— 

17 ‘‘(A) any film or television production if 

18 100 percent of the total compensation of the 

19 film or television production is compensation for 

20 services performed in the United States, and 

21 ‘‘(B) any theatrical production if 75 per22 cent of the total compensation of the theatrical 

23 production is qualified compensation. 

24 ‘‘(2) FILM OR TELEVISION PRODUCTION.— 


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1 ‘‘(A) IN GENERAL.—The term ‘film or tele2 vision production’ means property described in 

3 section 168(f)(3). 

4 ‘‘(B) SPECIAL RULE FOR TELEVISION SE5 RIES.—In the case of a television series— 

6 ‘‘(i) each episode of such series shall 

7 be treated as a separate production, and 

8 ‘‘(ii) only the first 44 episodes of such 

9 series shall be taken into account. 

10 ‘‘(3) THEATRICAL PRODUCTION.— 

11 ‘‘(A) IN GENERAL.—The term ‘theatrical 

12 production’ means a live staged production of a 

13 play (with or without music) which is derived 

14 from a written book or script and is produced 

15 or presented in any venue which has an audi16 ence capacity of not more than 3,000 or a se17 ries of venues the majority of which have an au18 dience capacity of not more than 3,000. 

19 ‘‘(B) TOURING COMPANIES.—In the case 

20 of multiple live staged productions for which an 

21 election under this section is made by the same 

22 taxpayer and which are— 

23 ‘‘(i) separate phases of a production, 

24 or 


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1 ‘‘(ii) separate simultaneous stagings 

2 of the same production in different geo3 graphical locations (not including multiple 

4 performance locations of any one touring 

5 production), 

6 each such live staged production shall be treat7 ed as a separate production. 

8 ‘‘(C) PHASES.—For purposes of subpara9 graph (B), the term ‘phase’ refers to each of 

10 the following (but only if the taxpayer treats 

11 each of the following as a separate activity for 

12 all purposes of this title): 

13 ‘‘(i) The initial staging of the produc14 tion. 

15 ‘‘(ii) Subsequent additional stagings 

16 or tourings of the production which are 

17 produced by the same producer as the ini18 tial staging. 

19 ‘‘(D) QUALIFIED COMPENSATION.— 

20 ‘‘(i) IN GENERAL.—For purposes of 

21 paragraph (1)(B), the term ‘qualified com22 pensation’ means compensation for services 

23 performed in the United States by actors, 

24 directors, musicians, producers, and other 

25 production and post-production personnel. 


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1 ‘‘(ii) PARTICIPATIONS AND RESIDUALS

2 EXCLUDED.—For purposes of paragraph 

3 (1)(B) and clause (i), the term ‘compensa4 tion’ does not include participations and 

5 residuals (as defined in section 

6 167(g)(7)(B)). 

7 ‘‘(4) EXCEPTION.—The term ‘qualified film, 

8 television, or theatrical production’ shall not include 

9 any production if records are required under section 

10 2257 of title 18, United States Code, to be main11 tained with respect to any performer in such produc12 tion.’’. 

13 (2) CONFORMING AMENDMENTS.— 

14 (A) Subsections (a)(1), (a)(2)(A), 

15 (a)(2)(B), (b), and (c)(1) of section 181 of such 

16 Code are each amended by striking ‘‘any quali17 fied film or television production’’ and inserting 

18 ‘‘any qualified film, television, or theatrical pro19 duction’’. 

20 (B) Section 181(f) of such Code is amend21 ed by striking ‘‘qualified film and television pro22 ductions’’ and inserting ‘‘any qualified film, tel23 evision, or theatrical production’’. 

24 (C) The heading of section 181 is amended 

25 by striking ‘‘QUALIFIED FILM AND TELEVerDate Sep 11 2014 02:17 Sep 23, 2014 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H5497.IH H5497

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1 VISION PRODUCTIONS’’ and inserting 

2 ‘‘QUALIFIED FILM, TELEVISION, AND THE3 ATRICAL PRODUCTIONS’’. 

4 (D) The item relating to section 181 in the 

5 table of sections for part VI of subchapter B of 

6 chapter 1 of such Code is amended to read as 

7 follows: 

‘‘Sec. 181. Treatment of certain qualified film, television, and theatrical productions.’’. 

8 (c) EFFECTIVE DATE.—The amendments made by 

9 this section shall apply to qualified film, television, and 

10 theatrical productions commencing after December 31, 

11 2013. 

Æ 


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