Production Deduction

The production deduction is one of those needlessly complicated deductions that only a government bureaucrat or a politician would love. However, it does result in some good tax savings if you qualify. The deduction is available to any type of business entity that generally makes something in the U.S. Also qualifying are construction activities and engineering and architectural services supporting construction in the United States. Even film production  qualifies.The deduction is equal to the lesser of 9% of the net qualified income or 50% of related W-2 wages of the taxpayer. To compute the deduction you fill out form 8903.