> Given that it is apparently not possible to prove that they deleted the movie, it seems like the IRS should assume that they still have the movie.

Even if they didn't delete the movie, the fact that they claimed to have deleted the movie and used it as a tax credit basically makes the value $0, because in the unlikely event they have a copy around, they wouldn't be able to sell it without having all of the profits seized from them.

> Given that it is apparently not possible to prove that they deleted the movie

Why does it matter if they delete it or not? As long as they don’t sell it, they don’t make a profit on it, and don’t pay taxes on the profits. If they didn’t delete it and then actually sold it after enjoying their tax break, then they’d be committing actual tax fraud.

> refusing to release or sell the movie should have triggered a shareholder lawsuit

And yet it didn’t. So maybe shareholders are fine with it? Why should shareholders sue when a company doesn’t release a product? This literally happens all the time.

Not an accountant, but tax write-offs aren't some sort of no tax glitch that you make them seem. You can only deduct losses that you've actually suffered, not imaginary losses. If you spent $10M into making a movie, you can't value the movie at $80M and then use that against all your other revenues to pay less taxes. If this were true every company would be making fake movies to destroy and pay less taxes, not destroy actual movies that they spent millions on.

Taxing people on income they didn't make but the government imagined they could have made in some situation that didn't happen sounds like a slippery slope to be standing on.