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Comment by nickelpro | Hacker News Reader

This isn't how tax write-offs work. The expenditures in the production of a film or TV series are always deducted from taxable net income regardless of whether the final product is released or not.

There are a plethora of reasons not to release a creative work. For example, you don't want to spend any more money on music licensing, editing, marketing, etc, that is unlikely to be recouped.

"Tax write-offs" simply isn't one of them

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Certain expenses will be capitalized while the film is available for release/streaming. Depreciation/amortization will be years for the life of the film. But if you scrap it right away, you can deduct those expenses immediately.

Yes, but the reason to do this is that the film is ultimately going to cost more money than it is worth, or the gross represents a rounding error on the studio's balance sheet.

You wouldn't capitalize the expenses of a film that was expected to recoup any meaningful amount of money on release. Either the thing is already costing you more money than it is worth or is a brand risk, thus you look for a way to get out as painlessly as possible.

They need the money now, they can't wait to depreciate it over time.

If the film was going to recoup at least the $10-$20M they'll save in taxes that FY they would release it.

The point is the property is worth negative or trivial value already. Either it's going to cost more to finish than it's worth, or it's worth next to nothing.

It’s actually only 5 years, not for the life of the film.

You also need to pay residuals to the writers / actors when people watch the show. If you never release it to audiences you don’t need to pay.

There have been multiple completed works that have been canceled for tax reasons.

https://deadline.com/2023/01/as-tv-turns-to-tax-write-offs-t...

You really shouldn't take fake news organizations like CNN seriously on issues like this. They obviously didn't do even basic fact checking with a real tax accountant or lawyer.

The source for that is two-season showrunner for a CW drama.

Also, this isn't a debate. The US tax code isn't something that's decided by CW showrunners.

It is though, I definitely had project not-launched which had expenses that accountants found much harder to justify then launched projects. Taxes isn't a hard science but a soft one, and when talking to a tax officer, as far as my limited knowledge goes, launching a product or movie does help to ease their fraud suspicions.

> For example, you don't want to spend any more money on music licensing, editing, marketing, etc, that is unlikely to be recouped.

I have no idea what "Max" is in the GP, but another big reason to not release a creative work is if audience feedback was negative enough that even releasing it for free would hit the value of your brand.

HBOmax - removed a ton of shows (some well regarded) for the tax write offs

Followed by the corporate rebrand from HBOMax to Max

That's nearly as dumb as the rebrand from Twitter to X. What's their leadership doing, adapting their brands to the public's ADD?

> I have no idea what "Max" is in the GP

HBO Max, a streaming service.

I know this is derailing the main thread, but then why are studios choosing not to release finished movies on streaming? It seems like they could recoup at least some of the expenses compared to just shelving the thing forever.

They're either:

A) Not as finished as being represented by media, and the costs associated with finishing them exceed the likely value of the finished product

B) The studio views the finished product as being of marginal value and damaging to their brand

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