26 U.S.C. § 181
Treatment of certain qualified productions
A taxpayer may elect to treat the cost of any qualified film or television production, any qualified live theatrical production, and any qualified sound recording production as an expense which is not chargeable to capital account. Any cost so treated shall be allowed as a deduction.
Paragraph (1) shall not apply to so much of the aggregate cost of any qualified film or television production or any qualified live theatrical production as exceeds $15,000,000.
Paragraph (1) shall not apply to so much of the aggregate cost of any qualified sound recording production, or to so much of the aggregate, cumulative cost of all such qualified sound recording productions in the taxable year, as exceeds $150,000.
With respect to the basis of any qualified film or television production, any qualified live theatrical production, or any qualified sound recording production to which an election is made under subsection (a), no other depreciation or amortization deduction shall be allowable.
An election under this section with respect to any qualified film or television production, any qualified live theatrical production, or any qualified sound recording production shall be made in such manner as prescribed by the Secretary and by the due date (including extensions) for filing the taxpayer’s return of tax under this chapter for the taxable year in which costs of the production are first incurred.
Any election made under this section may not be revoked without the consent of the Secretary.
The term “qualified film or television production” means any production described in paragraph (2) if 75 percent of the total compensation of the production is qualified compensation.
A production is described in this paragraph if such production is property described in section 168(f)(3).
A production is not described in this paragraph if records are required under section 2257 of title 18, United States Code, to be maintained with respect to any performer in such production.
The term “qualified compensation” means compensation for services performed in the United States by actors, production personnel, directors, and producers.
The term “compensation” does not include participations and residuals (as defined in section 167(g)(7)(B)).
The term “qualified live theatrical production” means any production described in paragraph (2) if 75 percent of the total compensation of the production is qualified compensation (as defined in subsection (d)(3)).
A production is described in this paragraph if such production is 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 by a taxable entity in any venue which has an audience capacity of not more than 3,000 or a series of venues the majority of which have an audience capacity of not more than 3,000.
In the case of a live staged production not described in subparagraph (B) which is produced or presented by a taxable entity for not more than 10 weeks of the taxable year, subparagraph (A) shall be applied by substituting “6,500” for “3,000”.
For purposes of clause (i), in the case of any taxable year of less than 12 months, the number of weeks for which a production is produced or presented shall be annualized by multiplying the number of weeks the production is produced or presented during such taxable year by 12 and dividing the result by the number of months in such taxable year.
A production is not described in this paragraph if such production includes or consists of any performance of conduct described in section 2257(h)(1) of title 18, United States Code.
For purposes of this section, the term “qualified sound recording production” means a sound recording (as defined in section 101 of title 17, United States Code) produced and recorded in the United States.
For purposes of this section, rules similar to the rules of subsections (b)(2) and (c)(4) of section 194 shall apply.
This section shall not apply to qualified film and television productions, qualified live theatrical productions, or qualified sound recording productions commencing after
A prior section 181, Pub. L. 87–834, § 2(c),
2025—Pub. L. 119–21, § 70434(h)(1), amended section catchline generally. Prior to amendment, section catchline read as follows: “Treatment of certain qualified film and television and live theatrical productions”.
Subsec. (a)(1). Pub. L. 119–21, § 70434(a), substituted “qualified film or television production, any qualified live theatrical production, and any qualified sound recording production” for “qualified film or television production, and any qualified live theatrical production,”.
Subsec. (a)(2)(C). Pub. L. 119–21, § 70434(b), added subpar. (C).
Subsec. (b). Pub. L. 119–21, § 70434(c), substituted “qualified film or television production, any qualified live theatrical production, or any qualified sound recording production” for “qualified film or television production or any qualified live theatrical production”.
Subsec. (c)(1). Pub. L. 119–21, § 70434(d), substituted “qualified film or television production, any qualified live theatrical production, or any qualified sound recording production” for “qualified film or television production or any qualified live theatrical production”.
Subsecs. (f), (g). Pub. L. 119–21, § 70434(e), added subsec. (f) and redesignated former subsec. (f) as (g). Former subsec. (g) redesignated (h).
Subsec. (h). Pub. L. 119–21, § 70434(f), substituted “qualified film and television productions, qualified live theatrical productions, or qualified sound recording productions” for “qualified film and television productions or qualified live theatrical productions”.
Pub. L. 119–21, § 70434(e), redesignated subsec. (g) as (h).
2020—Subsec. (g). Pub. L. 116–260 substituted “
2019—Subsec. (g). Pub. L. 116–94 substituted “
2018—Subsec. (g). Pub. L. 115–123 substituted “
2015—Pub. L. 114–113, § 169(b)(2)(C), inserted “and live theatrical” after “film and television” in section catchline.
Subsec. (a)(1). Pub. L. 114–113, § 169(b)(1), inserted “, and any qualified live theatrical production,” after “any qualified film or television production”.
Subsecs. (a)(2)(A), (B), (b), (c)(1). Pub. L. 114–113, § 169(b)(2)(A), inserted “or any qualified live theatrical production” after “qualified film or television production”.
Subsec. (e). Pub. L. 114–113, § 169(c)(2), added subsec. (e). Former subsec. (e) redesignated (f).
Subsec. (f). Pub. L. 114–113, § 169(c)(1), redesignated subsec. (e) as (f). Former subsec. (f) redesignated (g).
Pub. L. 114–113, § 169(b)(2)(B), which directed insertion of “or qualified live theatrical productions” after “qualified film or television productions”, was executed by making the insertion after “qualified film and television productions”, to reflect the probable intent of Congress.
Pub. L. 114–113, § 169(a), substituted “
Subsec. (g). Pub. L. 114–113, § 169(c)(1), redesignated subsec. (f) as (g).
2014—Subsec. (f). Pub. L. 113–295 substituted “
2013—Subsec. (f). Pub. L. 112–240 substituted “
2010—Subsec. (f). Pub. L. 111–312 substituted “
2008—Subsec. (a)(2)(A). Pub. L. 110–343, § 502(b), reenacted heading without change and amended text generally. Prior to amendment, text read as follows: “Paragraph (1) shall not apply to any qualified film or television production the aggregate cost of which exceeds $15,000,000.”
Subsec. (d)(3)(A). Pub. L. 110–343, § 502(d), substituted “actors, production personnel, directors, and producers.” for “actors, directors, producers, and other relevant production personnel.”
Subsec. (f). Pub. L. 110–343, § 502(a), substituted “
2005—Subsec. (d)(2). Pub. L. 109–135 struck out “For purposes of a television series, only the first 44 episodes of such series may be taken into account.” at end of subpar. (A), added subpar. (B), and redesignated former subpar. (B) as (C).
Amendment by Pub. L. 119–21 applicable to productions commencing in taxable years ending after
Pub. L. 116–260, div. EE, title I, § 116(b),
Pub. L. 116–94, div. Q, title I, § 117(b),
Pub. L. 115–123, div. D, title I, § 40308(b),
Pub. L. 114–113, div. Q, title I, § 169(d),
Pub. L. 113–295, div. A, title I, § 129(b),
Pub. L. 112–240, title III, § 317(b),
Pub. L. 111–312, title VII, § 744(b),
Pub. L. 110–343, div. C, title V, § 502(e),
Amendment by Pub. L. 109–135 effective as if included in the provision of the American Jobs Creation Act of 2004, Pub. L. 108–357, to which such amendment relates, see section 403(nn) of Pub. L. 109–135, set out as a note under section 26 of this title.
Pub. L. 108–357, title II, § 244(c),