End of a Honeymoon

The news that Hollywood's harassed major studios had prayed for—and which Hollywood's fast-growing independent producers had dreaded—came last week. It was in the form of a letter from the Commissioner of Internal Revenue to a money-making independent (his name was withheld). The letter said, in effect, that the "collapsible corporation," which had lined the pockets of Hollywood's independent producers and free-lance actors, was out.

It was an illegal tax dodge, said Internal Revenue.

The collapsible corporation, supposedly invented by Sam Goldwyn, had looked like a shrewd device to get around sky high taxes. A producer simply set up a corporation, made...

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