H.R. 761 — HITS Act

This section expands the expensing election under IRC §181 (which allows immediate deduction of production costs, in lieu of capitalization and depreciation or amortization, for qualified film or television productions and qualified live theatrical productions) to include qualified sound recording productions (i.e., sound recordings, as defined in 17 U.S.C. §101, produced and recorded in the U.S.), subject to a $150,000 aggregate cost limitation per production or for all such productions during the taxable year. It further (1) prohibits any other deduction or amortization for those costs, (2) permits a corresponding election, and (3) adds qualified sound recording productions to the definition of qualified property eligible for bonus depreciation under IRC §168(k), deeming such productions placed in service at the time of initial release or broadcast (without regard to the §181 cost limitation). The amendments apply to productions commencing in taxable years ending after the date of enactment.