II 110th CONGRESS 2d Session S. 3330 IN THE SENATE OF THE UNITED STATES July 24 (legislative day, July 23), 2008 Mrs. Feinstein (for herself and Mr. Smith) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to modify the deduction for domestic production activities for film and television productions, and for other purposes.

1.

Short title

This Act may be cited as the Domestic Film Production Equity Act of 2008.

2.

Provisions related to film and television productions

(a)

Modifications to deduction for domestic activities

(1)

Determination of W–2 wages

Paragraph (2) of section 199(b) of the Internal Revenue Code of 1986 (relating to W–2 wages) is amended by adding at the end the following new subparagraph: (D)

Special rule for qualified film

In the case of a qualified film, such term shall include compensation for services performed in the United States by actors, production personnel, directors, and producers. . (2)

Definition of qualified film

Paragraph (6) of section 199(c) of such Code (relating to qualified film) is amended by adding at the end the following: A qualified film shall include any copyrights, trademarks, or other intangibles with respect to such film. The methods and means of distributing a qualified film shall not affect the availability of the deduction under this section.. (3)

Partnerships

Subparagraph (A) of section 199(d)(1) of such Code (relating to partnerships and S corporations) is amended by striking and at the end of clause (ii), by striking the period at the end of clause (iii) and inserting , and, and by adding at the end the following new clause: (iv)in the case of each partner of a partnership, or shareholder of an S corporation, who owns (directly or indirectly) at least 20 percent of the capital interests in such partnership or of the stock of such S corporation— (I)such partner or shareholder shall be treated as having engaged directly in any film produced by such partnership or S corporation, and (II)such partnership or S corporation shall be treated as having engaged directly in any film produced by such partner or shareholder. . (b)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2007.