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Warner Bros. Under Investigation for Tax Fraud on ‘Sully’

Warner Bros is under investigation for tax fraud involving the production of their 2016 film ‘Sully.’ The state of Georgia is looking into fraudulent claims of up to $600,000 claimed by the studio. Cred. Courtesy of Warner Bros

Warner Bros. is under investigation for Tax Fraud on the production of their 2016 film Sully. The studio claimed a tax credit of over $600,000 on the film’s production for airplane equipment in Georgia. However, Variety is reporting that the equipment was never actually used in the state. Georgia offers a sizeable tax credit for film production costs, so long as they are incurred in the state.

Variety obtained contracts and emails showing that expenses billed to Georgia were identical to expenses actually incurred in California. The production apparently went as far to move a small airplane fuselage to Atlanta in an attempt to legitimize the Georgia based expenses. That piece matched one that was used in California, it was ultimately claimed on the Georgia tax credit but wasn’t actually used there.

The Georgia attorney general’s office was informed of the issue last summer and opened an investigation in July. The Georgia Department of Revenue oversees the Film Incentive Program and is currently auditing the production, prosecutors are waiting for the results before proceeding.

“I can confirm that we opened a file and referred the matter to the Department of Revenue,” said Katie Byrd, a spokeswoman for the attorney general’s office.

In a statement to Variety, a Warner Bros. spokesperson denied wrongdoing.

“We carefully followed the rules and regulations as set forth by the state of Georgia,” the spokesperson said. “After production, we submitted our qualifying expenditures, and they were fully audited and approved without question by the Georgia Department of Revenue.”

In Georgia, tax fraud can be a felony that carries a $500,000 fine and up to five years in prison. This would be the first case of a major studio being charge by a state film incentive program and the first case of anyone being publicly accused of such.

This case is still developing and will be updated as things progress.

The post Warner Bros. Under Investigation for Tax Fraud on ‘Sully’ appeared first on Def Pen.



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