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Deleting and destroying finished movies

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Re: Deleting and destroying finished movies

#131

Post by s1artibartfast »

lisper wrote: post #36
gruez wrote: post #27

Earlier quoted context omitted.

> That they actually incurred the losses they claim to have incurred, so they get a tax break. The taxpayer is defrauded. Did they not incur such losses? Did they claim to delete the movie but actually kept a backup? Granted, the loss is self-inflicted, but that's not a relevant factor in the tax code.

Destroying a movie to claim the tax break is analogous to burning your house down for the insurance money or to claim a casualty loss. Yes, you really did lose your house. No, you are not entitled to claim it as a write-off.

nobody is paying the company money.

It is closer to burning down your house to avoid property or sales tax.

Re: Deleting and destroying finished movies

#132

Post by AlbertCory »

prepend wrote: post #96
AlbertCory wrote: post #22

Where do you draw the line? If an artist pays a model and paints her, is the artist to be prohibited from destroying the painting because it sucks, and because the model wants credit? What about a music producer who pays a studio band to record a song that turns out to be terrible -- is the producer prohibited from deleting it? It's the tax write off for destruction that's fucked up, as @cnees says. Failures are part…

> It's the tax write off for destruction that's fucked up How so? They aren’t selling it. So its value is $0. If the artist burns the painting, its value is $0. Is it bad because the artist could have sold it and chose not to? And it’s not fraud, because if the studio ever chooses to sell, they will pay taxes on 100% since they already deducted all expenses. I’m not really sure what you’re arguing. What’s the alterna…

It's not "odd." Anything you build can have a "salvage value." Someone would take it off your hands, be it a building, a car, or a movie.

Unless, of course, everyone's unions agreed on destruction, via their contracts.

Re: Deleting and destroying finished movies

#133

Post by merrywhether »

WBD is a public company, can the shareholders sue or otherwise punish the board/CEO? I'm not sure where those boundaries are, just top of mind because of the recent Musk action. That seems like the appropriate source of any enforcement on this angle, as shareholders are most affected by these decisions and have standing.

Re: Deleting and destroying finished movies

#134

Post by gruez »

AlbertCory wrote: post #120
gruez wrote: post #65

Earlier quoted context omitted.

And the value went to $0 after destroying it. I don't see what's the issue is here.

If you can't understand accounting, maybe an introductory course would help.

Whatever "introductory course" you took must be pretty bad, because even the elective I took in college taught that valuations on the same asset can go up and down.

Re: Deleting and destroying finished movies

#135

Post by s1artibartfast »

lisper wrote: post #121
prepend wrote: post #116

Earlier quoted context omitted.

> analogous to burning your house down for the insurance money It’s very different because insurance pays out to make whole. Taxes are just taxes. It’s the equivalent of burning your house down and then writing off the depreciated value because it burned down. Totally legal. Because it’s worth less after burning it down. Assuming you burn it in a legal, controlled manner and not arson.

Every tax dollar you don't pay is a dollar someone else has to pay instead, or a dollar that gets added to the national debt. And burning your house down and writing off the depreciated value is absolutely not legal. > Assuming you burn it in a legal, controlled manner and not arson. Yes, well, that is a might big assumption. I doubt you could point me to a single instance of someone actually burning down their house…

>Every tax dollar you don't pay is a dollar someone else has to pay instead, or a dollar that gets added to the national debt. And burning your house down and writing off the depreciated value is absolutely not legal.

nobody is entitled tax revenue. Laws generally support taxes on income/profit, and arent just a bill.

It isn't illegal to work less and pay less taxes.

It is absolutely legal to knock down your house so you dont have to pay property or mortgage tax on it.

Re: Deleting and destroying finished movies

#136

Post by s1artibartfast »

lisper wrote: post #121
prepend wrote: post #116

Earlier quoted context omitted.

> analogous to burning your house down for the insurance money It’s very different because insurance pays out to make whole. Taxes are just taxes. It’s the equivalent of burning your house down and then writing off the depreciated value because it burned down. Totally legal. Because it’s worth less after burning it down. Assuming you burn it in a legal, controlled manner and not arson.

Every tax dollar you don't pay is a dollar someone else has to pay instead, or a dollar that gets added to the national debt. And burning your house down and writing off the depreciated value is absolutely not legal. > Assuming you burn it in a legal, controlled manner and not arson. Yes, well, that is a might big assumption. I doubt you could point me to a single instance of someone actually burning down their house…

>Every tax dollar you don't pay is a dollar someone else has to pay instead, or a dollar that gets added to the national debt. And burning your house down and writing off the depreciated value is absolutely not legal.

nobody is entitled tax revenue. Laws generally support taxes on income/profit, and arent just a bill.

It isn't illegal to work less and pay less taxes.

It is absolutely legal to knock down your house so you dont have to pay property or sales tax on it.

Re: Deleting and destroying finished movies

#138

Post by [deleted] »

loughnane wrote: post #52

Commenting before I've read the article: That's ridiculous. There's no obligation for anyone to bring something to market regardless of how far along it is. After I read the article: Still not persuaded. It reads like motivated reasoning, the person doesn't like things not getting released and says that governments should step in. There's some mention of taxes and lost work, but nothing tht holds water. As an example…

[deleted]

Re: Deleting and destroying finished movies

#139

Post by loughnane »

advael wrote: post #93
loughnane wrote: post #90

Earlier quoted context omitted.

If we're to do that are we going to force every company to release a product they've developed, or otherwise the code/blueprints for it? Aside from the reputation hit I mentioned, the unreleased film might have some neat ideas they want to recycle into another, better project. There's a case to be made that we should eliminate tax breaks for all "R&D" work, but this article doesn't persuade me. It reads like it was w…

Again, eliminating a perverse tax incentive doesn't "force" anyone to do anything. Why is it self-evident that we should subsidize failure at the level of a corporation to prevent balance sheets going negative, especially when we are so against doing the same for an individual to prevent them from becoming homeless?

Don’t think it’s self-evident. My point was only that if I were to accept OPs argument I’d have to accept them larger argument to abolish the existing subsidies, and the article didn’t persuade me that to do so is the best way to go.

I’d like to read an argument against subsidizing development.

Re: Deleting and destroying finished movies

#140

Post by tpmoney »

AlbertCory wrote: post #122
sokoloff wrote: post #107

Earlier quoted context omitted.

If they irretrievably destroy it, its value becomes zero. That's the essence of being able to claim the tax loss (to "finally determine the value"). It's no different from having a stock position in a company that's in limbo. You can't claim the tax loss and keep the position. You have to get the clearinghouse to take the position for $0 in order to claim the loss. The studio's position is that they've already incurr…

In the IRS's eyes, you destroyed an item that had value. Its value was whatever someone was willing to pay for it. Say $30M. If you destroyed it, that was your choice, but you didn't thereby incur a loss of $30M. Any more than if you had dynamited your HQ building.

That's not how this works though, right? They're not saying "we think this movie was worth $100 million because that's what someone offered us, so we're going to write off $100 million.", they're saying "We spent $100 million on making this, and we think there's no way to recoup the expenses by releasing it, so we're writing off the $100 million we already spent on it." The "we already spent that money" is the key part here.

If you're running "Loot Boxes Unlimited" and your business is taking off like a rocket and you invest $300 million in a new HQ, and then just as your finishing up, congress passes a law making loot boxes illegal and you're no longer going to be able to afford moving into that new HQ, you get to write off those expenses just the same. You must offset them by any gains you get from any part of it you do sell off, but you're under no obligation to sell the building, you can just keep it on the books depreciating slowly. Most companies will try to sell what they can to recoup some of those losses, because recouping any of the loss tends to be a better financial option than the write off for that same amount. But selling a building doesn't have the same legal and contractual entanglements that selling a movie might have.

Additionally a building is still useful even if you can't use it for what it was originally intended for. But who is going to buy a movie they can't release? You'd need some company with enough money to buy a produced movie (even if at a discount) who also thinks they could release it and make enough money on it to cover their costs AND who will also be willing to take on all the contractual obligations like licensing and residuals. And chances are in addition to all of that, they also have to be willing to license the various properties that the movie studio already owns (or worse, re-negotiate the rights from the original holders that the studio had already previously negotiated).

It's also important to remember that those expenses would have been written off whether or not the movie was released. My understanding here is the only difference between releasing and not releasing the movie is whether that write off occurs over 3-5 years, or all in this year

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