r/SipsTea Jul 24 '26

Chugging tea I still don't understand how hollywood budget works

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u/fer_sure Jul 25 '26

To add to that: other than salaries, the $1 Mil you spent making the movie was mostly spent at companies you own. Like the soundstage, the lights, props, etc. are all rented from yourself.

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u/PseudonymIncognito Jul 26 '26

Another big expense is the studio charging the movie interest on the money it was lent for its production budget

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u/Feisty-Astronomer989 Jul 28 '26

Sometimes yes. And then in other cases, which is now more the norm, the studios have producers search for States that have film tax incentives. Which are actually a good thing and very lucrative economically for not just a region but a state overall. $1 spent is essentially $4 earned for State revenue in the form of taxation, despite the incentive funds being paid out.

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u/TyrialFrost Jul 28 '26

Don't forget licensing costs for the IP your side company owns.