Canadian's film investors win.

The Canadian federal government has reached an out-of-court settlement allowing investors to keep tax deductions that they received from investing in the country's film-related tax shelters.

The shelters, which helped the government raise C$3 billion for film production, are credited with creating as many as 60,000 new jobs and causing an explosion in filmmaking. Though almost 12,000 Canadians are believed to have invested in the shelters, the programs were canceled in 2001 and have been under investigation for mishandling ever since. Investors were notified that most of their deductions would be recollected.

Approximately 3,200 Canadians invested in a tax shelter organized by Vancouver-based Sentinel Hill Ventures and received hundreds of millions of dollars in deferred tax deductions over 10 years. Last year, when officials from the Canada Revenue Agency launched an audit of the company, investors were in danger of losing 70 percent of their tax deductions. But they can now breathe a sigh of relief since the government settlement assures that they are in danger of losing no more than nine percent of their deductions.