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Second, large budget blockbuster movies require large up-front investments and low-budget motion pictures cannot benefit from the current proposal. Only intermediate-budget motion pictures such as Never Split Tens can be funded in the manner proposed.
Second, large budget blockbuster movies require large up-front investments and low-budget motion pictures cannot benefit from the current proposal. Only intermediate-budget motion pictures such as Never Split Tens can be funded in the manner proposed.
Finally, many motion pictures are shot in multiple states. The cost of production, as a result, is split among those states rather than occurring entirely in one state, for example, Illinois, and many of those states lack the tax credit incentives provided by Illinois.
Finally, relatively few motion pictures are shot entirely in Illinois. Many motion pictures are shot in multiple states. Some locations may be shot in Chicago, for example, but the sound stages are based in Los Angeles. The cost of production, as a result, is split among those states rather than occurring entirely in Illinois, reducing the value of the Illinois tax credit.
In short, the mode of funding is only viable for moderate-budget films shot entirely in Illinois since 2011.
In short, the mode of funding is only viable for moderate-budget films shot entirely in Illinois since 2011.
====Example B – Corporate====
====Example B – Corporate====
If a single corporation provides the entire loan, its loan-investment of $2.9 million results in a $2.9 million federal deduction. For those in, for example, the 20% tax bracket, this results in a tax savings of $580,000. The earnings on the loan ($580,000+$100,000)/$2,900,000 x 100 = 23% for eight months, equivalent to 35% interest annualized.
If a single firm provides the entire loan, its loan-investment of $2.9 million results in a $2.9 million federal deduction. For those in, for example, the 20% tax bracket, this results in a tax savings of $580,000. The earnings on the loan ($580,000+$100,000)/$2,900,000 x 100 = 23% for eight months, equivalent to 35% interest annualized. A corporation paying federal taxes at the 35% rate would earn 58% annualized.
NOTE: If the following Table is not visible in your browser, go directly to the Table here:</br>[[Media:Taxincentivescorporate.jpg]]
NOTE: If the following Table is not visible in your browser, go directly to the Table here:</br>[[Media:Taxincentivescorporate.jpg]]
[[File: Taxincentivescorporate.jpg|thumb|center|600px|<small> The Illinois income tax credit and federal income tax deduction basis for funding of <i>Never Split Tens</i> for corporations in a given federal tax bracket.</small>]
[[File: Taxincentivescorporate.jpg|thumb|center|600px|<small> The Illinois income tax credit and federal income tax deduction basis for funding of <i>Never Split Tens</i> for corporations in a given federal tax bracket.</small>]]
===Investor Share of Profits===
===Investor Share of Profits===