After the shocking cancellation of Batgirl which was pretty much unpredicted for the DC fans, Warner Bros. Discovery reportedly plans to use the movie as a tax write-off. After years of mismanagement of WB and the DC universe David Zaslav took some serious steps to turn the fate of the company. Earlier the film’s director opened up and claimed that Warner Bros Discovery has allegedly “blocked” their access to footage after scrapping the film.
Discovery’s post-merger tax options come with a good advantage to totally scrap the movie as a tax write-off, and this might be the main reason. The movie featured Leslie Grace as Barbara Gordon and was set to be released later this year and even featured Michael Keaton’s return as Batman.
A Big Tax Write-off Might Be a Reason Behind Scrapping of $90 Million Batgirl Movie
There is one term known as “Hollywood accounting” which is often referred to as budget and tax strategies used by movie studios. It depends on some unique reasons related to the way movies are developed and monetized including tax, which opens a lot of opportunities for studios to minimize costs as much as they want. In simple words, accounting is the practice of recording assets and rights for financial, legal, and even tax purposes.
Warner Bros Discovery could destroy all footage of ‘BATGIRL’ to demonstrate to the IRS there will never be revenue made from the film, and can immediately receive the full tax write-down but some think this is unlikely to happen.
— DiscussingFilm (@DiscussingFilm) August 24, 2022
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This is a very common ritual going on in the industry which includes spending lots of bucks on movies that are predicted to bomb and then they can report a huge loss and use it to get rid of their tax burden.
How Batgirl Represents a Rare Tax Opportunity for Warner Bros. Discovery?
Previously, there have been the same cases where movies are canceled or directly destroyed so they can be used as a tax write-off, and the same case might have happened with Batgirl. There is a point to note that, Batgirl would be even more expensive with a theatrical release because the cost of distribution and marketing would add more earnings to its budget. Scrapping it was the best option for them and completely destroying it could provide the company a good write-off on this year’s federal tax return.