H.R. 3844: Texas is the New Hollywood Act of 2025

This bill, titled "Texas is the New Hollywood Act of 2025," aims to amend the Internal Revenue Code regarding tax treatments for film and television productions in Texas. The primary goals of the bill include extending the bonus depreciation available to qualified productions and establishing minimum spending requirements for these productions within the state.

Key Provisions

• Bonus Depreciation Extension: The bill proposes that bonus depreciation for qualified film or television productions be extended until January 1, 2035. This is a significant change from the previous end date of January 1, 2027.
• Definition of Qualified Productions: Qualified film or television productions must meet specific criteria:
  • Intended for commercial, educational, or instructional use.
  • Meets the definition in existing tax law regarding film and television production.
  • Incurred expenses must meet minimum spending thresholds.
• Minimum Spending Thresholds: The bill sets minimum state spending requirements:
  • For educational or instructional video or digital interactive media production, the minimum is $100,000.
  • For other types of film or television productions, the minimum is $500,000.
• Applicable Percentage for Depreciation: The applicable percentage for bonus depreciation for qualified productions is set at 100 percent for property placed in service after December 31, 2025, and before January 1, 2036.
• Effective Date: The changes will apply to property placed in service after December 31, 2025.

Through these amendments, the bill aims to boost the film and television industry within Texas by providing more favorable tax incentives for productions that choose to operate within the state.

Relevant Companies

• AMZN (Amazon.com, Inc.): As a major player in the production and distribution of movies and television shows through its Amazon Prime Video service, Amazon could benefit from the extended tax incentives aimed at productions made within Texas.
• DIS (The Walt Disney Company): Disney, known for its extensive film and television content, may also take advantage of tax benefits from filming productions in Texas.
• CMCSA (Comcast Corporation): Comcast, as the parent company of NBCUniversal, is involved in movie and television production and could see cost benefits from these incentives.