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. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Film Incentive Reform 
Act of 2014’’. 
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SEC. 2. MODIFICATION AND EXTENSION OF ELECTION TO 
EXPENSE THE COST OF QUALIFIED FILM, 
TELEVISION, 
AND 
THEATRICAL 
PRODUC-
TIONS. 
(a) EXTENSION.—Section 181(f) of the Internal Rev-
enue Code of 1986 is amended by striking ‘‘December 31, 
2013’’ and inserting ‘‘December 31, 2015’’. 
(b) MODIFICATION OF QUALIFIED FILM, TELEVISION 
AND THEATRICAL PRODUCTIONS TO WHICH SECTION AP-
PLIES.— 
(1) IN GENERAL.—Section 181(d) of such Code 
is amended to read as follows: 
‘‘(d) QUALIFIED FILM, TELEVISION, OR THEATRICAL 
PRODUCTION.—For purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘qualified film, 
television, or theatrical production’ means— 
‘‘(A) any film or television production if 
100 percent of the total compensation of the 
film or television production is compensation for 
services performed in the United States, and 
‘‘(B) any theatrical production if 75 per-
cent of the total compensation of the theatrical 
production is qualified compensation. 
‘‘(2) FILM OR TELEVISION PRODUCTION.— 
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‘‘(A) IN GENERAL.—The term ‘film or tele-
vision production’ means property described in 
section 168(f)(3). 
‘‘(B) SPECIAL RULE FOR TELEVISION SE-
RIES.—In the case of a television series— 
‘‘(i) each episode of such series shall 
be treated as a separate production, and 
‘‘(ii) only the first 44 episodes of such 
series shall be taken into account. 
‘‘(3) THEATRICAL PRODUCTION.— 
‘‘(A) IN GENERAL.—The term ‘theatrical 
production’ means a live staged production of a 
play (with or without music) which is derived 
from a written book or script and is produced 
or presented in any venue which has an audi-
ence capacity of not more than 3,000 or a se-
ries of venues the majority of which have an au-
dience capacity of not more than 3,000. 
‘‘(B) TOURING COMPANIES.—In the case 
of multiple live staged productions for which an 
election under this section is made by the same 
taxpayer and which are— 
‘‘(i) separate phases of a production, 
or 
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‘‘(ii) separate simultaneous stagings 
of the same production in different geo-
graphical locations (not including multiple 
performance locations of any one touring 
production), 
each such live staged production shall be treat-
ed as a separate production. 
‘‘(C) PHASES.—For purposes of subpara-
graph (B), the term ‘phase’ refers to each of 
the following (but only if the taxpayer treats 
each of the following as a separate activity for 
all purposes of this title): 
‘‘(i) The initial staging of the produc-
tion. 
‘‘(ii) Subsequent additional stagings 
or tourings of the production which are 
produced by the same producer as the ini-
tial staging. 
‘‘(D) QUALIFIED COMPENSATION.— 
‘‘(i) IN
GENERAL.—For purposes of 
paragraph (1)(B), the term ‘qualified com-
pensation’ means compensation for services 
performed in the United States by actors, 
directors, musicians, producers, and other 
production and post-production personnel. 
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‘‘(ii) PARTICIPATIONS AND RESIDUALS 
EXCLUDED.—For purposes of paragraph 
(1)(B) and clause (i), the term ‘compensa-
tion’ does not include participations and 
residuals 
(as 
defined 
in 
section 
167(g)(7)(B)). 
‘‘(4) EXCEPTION.—The term ‘qualified film, 
television, or theatrical production’ shall not include 
any production if records are required under section 
2257 of title 18, United States Code, to be main-
tained with respect to any performer in such produc-
tion.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) 
Subsections 
(a)(1), 
(a)(2)(A), 
(a)(2)(B), (b), and (c)(1) of section 181 of such 
Code are each amended by striking ‘‘any quali-
fied film or television production’’ and inserting 
‘‘any qualified film, television, or theatrical pro-
duction’’. 
(B) Section 181(f) of such Code is amend-
ed by striking ‘‘qualified film and television pro-
ductions’’ and inserting ‘‘any qualified film, tel-
evision, or theatrical production’’. 
(C) The heading of section 181 is amended 
by striking ‘‘QUALIFIED
FILM
AND
TELE-
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VISION
PRODUCTIONS’’ 
and 
inserting 
‘‘QUALIFIED FILM, TELEVISION, AND THE-
ATRICAL PRODUCTIONS’’. 
(D) The item relating to section 181 in the 
table of sections for part VI of subchapter B of 
chapter 1 of such Code is amended to read as 
follows: 
‘‘Sec. 181. Treatment of certain qualified film, television, and theatrical produc-
tions.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to qualified film, television, and 
theatrical productions commencing after December 31, 
2013. 
Æ 
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