Louisiana Film-TV Incentives Compete with California’s Extension on Film-TV Tax Credit

February 6, 2013 - 3 minute read

The Governor of California, Jerry Brown, recently allowed “a two-year extension of California’s $100 million-a-year film and television tax credit program.” This gives the state five more years to make the film tax credit available. The California Film Commission goes into further detail as to what this program involves.

R&E photo 2The California Film and Television Tax Credit Program was put into place so that “qualified taxpayers [could get] a credit against income and/or sales and use taxes, based on qualified expenditures for taxable years beginning on or after January 1, 2011. Credits applied to income tax liability are not refundable. Only tax credits issued to an “independent film” may be transferred or sold to an unrelated party. Other qualified taxpayers may carry over tax credits for 5 years and transfer tax credits to an affiliate”.

There is more information regarding what type of productions are approved to use this tax program. However, the problem California is facing is that $100 million might not be enough to keep up with other states that have similar tax credits. There is currently a waiting list to even apply for it in California. A lot of people are choosing to make their movies in states where they can benefit.

Louisiana has an attractive Motion Picture Tax Incentive Act. With a 30% investor tax credit, it’s no wonder why this state is ranked as the nations #1 location destination state for film production in the U.S. The film investment must exceed $300,000, but there is an additional 5% tax credit if residents of Louisiana are employed as crew members and support staff. Filmmakers also get 25% production credit, 25% infrastructure credit, 25% digital media, and 25% live performance credit. There is a 10% tax credit thrown in with live performances if residents of Louisiana are used in the production.

In comparison, the Georgia 2008 Entertainment Industry Investment Act offers a 20% tax credit of all production costs on films or shows that spend more than $500,000. California’s equivalent incentive requires television series and feature films to be at least $1 million but no more than $75 million in production costs. The $500,000 minimum only applies to Movies of the Week and Miniseries in California. Georgia also offers an additional 10% tax cut if the state’s entertainment logo is placed in the credits of the film or show.

Louisiana and Georgia are not the only states on which filmmakers are setting their sights to do their filming. North Carolina has a 25% tax credit, and the minimum amount of production costs is only $250,000. Colorado, Washington, and Oregon also offer tax programs that can benefit filmmakers. Until California’s tax credit program can compete with those of other states, many filmmakers will continue to take advantage of whatever incentives suit their production needs.

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