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You clearly don't understand tax write offs. How would they "not take the tax write off"?? The tax write off is the expenses they made while creating the film.
by djaro 3y ago
You clearly don't understand tax write offs. How would they "not take the tax write off"?? The tax write off is the expenses they made while creating the film. There is no way for them not to write it off, after the expenses have been made.
If they earn $100 and then spend $100, they have to write it off, because they no longer have the money, so they can't pay taxes on it.
- adhesive_wombat 3y agoIf they want to use the expense they made on the (apparently) failed film to reduce their tax burden, they can trade that multimillion reduction in their tax for the (according to them) worthless materials they did end up with. If those materials have worth, then they shouldn't be writing them off in the first place while also sitting on them. If they don't have worth, it shouldn't be a problem. Except in some zero-sum type thing where they'd rather destroy it then let anyone else benefit, and then there's a question of if society at large should be footing the bill for the destruction of value in order to stymie competitors. Now, clearly, that's not how the rules actually currently work or we wouldn't be in here at all.
- rahimnathwani 3y agoYou're wrong. Not all costs incurred in the current year reduce taxes in the current year. These weren't expenses (which reduce net income in the period when incurred) but investments in a new movie (which create assets which sit on the balance sheet). The decision to write off the asset in the current year (rather than amortizing it over time) is the result of a business decision.
- fzeroracer 3y agoNo, the tax write-off in this situation is the company saying that they will never release or profit off something ever again. This allows them to artificially reduce the value of their asset to 0.