1. If any tangible personal property is
acquired by a production company as an asset, the provisions of this section
apply to the calculation of the costs of the tangible personal property that
constitute a qualified direct production expenditure.
2. If the tangible personal property is
destroyed as part of the qualified production, the cost of the tangible
personal property that constitutes a qualified direct production expenditure is
the purchase price of the tangible personal property. The production company
must submit to the Office satisfactory proof of the purchase price and that the
tangible personal property is destroyed as part of the qualified
production.
3. If, after production
of the qualified production, the production company donates the tangible
personal property or otherwise gives away the tangible personal property, the
cost of the tangible personal property that constitutes a qualified direct
production expenditure is:
(a) If the purchase
price of the tangible personal property is $10,000 or more, 50 percent of the
purchase price.
(b) If the purchase
price of the tangible personal property is less than $10,000, the purchase
price.
The production company must submit to the Office satisfactory
proof of the purchase price and that the production company donates or
otherwise gives away the tangible personal property.
4. If, after production of the
qualified production, the production company sells the tangible personal
property, the cost of the tangible personal property that constitutes a
qualified direct production expenditure is:
(a) If the purchase price of the tangible
personal property is $10,000 or more, the lesser of 50 percent of the purchase
price or the purchase price less the amount for which the production company
sold the tangible personal property.
(b) If the purchase price of the tangible
personal property is less than $10,000, the purchase price less the amount for
which the production company sold the tangible personal property.
The production company must submit to the Office satisfactory
proof of the purchase price and the amount for which the production company
sold the tangible personal property.
5. If, after production of the qualified
production, the production company keeps the tangible personal property, the
cost of the tangible personal property that constitutes a qualified direct
production expenditure is:
(a) If the
purchase price of the tangible personal property is $10,000 or more, 50 percent
of the purchase price.
(b) If the
purchase price of the tangible personal property is less than $10,000, the
purchase price.
The production company must submit to the Office satisfactory
proof of the purchase price.
