Best Film Incentives That Are Available In The United States

Aug 30, 2017|Entertainment finance
Rodriques Law

Most states provide some form of soft money film financing to production companies. Soft money are state subsidies in the form of tax credits, cash rebates and grants. They provide partial financing for productions, to cover pre-production, production and post-production expenses, including the costs of goods and services and wages or salaries paid to each resident and non-resident cast and crew.

State subsidies are designed to encourage production companies to produce film and television projects in the state, help create and maintain film industry jobs, promote tourism and the state’s image, and have a positive impact on the state’s economy. In fact, film incentives have served as engines of the film industry’s phenomenal growth in many of the states in the U.S.

For those of you who are trying to decide where to shoot or do post for your next film or television program, the following are the states with the best film incentives in the U.S.

Alabama: 25% rebate on qualified production expenditures, plus 35% rebate for resident labor. Minimum spend: $500,000

Arkansas: 20% rebate on qualified production expenditures (including salaries and wages paid to resident and nonresident above-the-line and below-the-line employees), plus 10% for below-the-line resident labor. Below-the-line does not include directors and producers but for purposes of the additional 10%, resident actors and writers are defined as below-the-line. Minimum spend: $50,000 for pre-production and production within a six-month period, $200,000 for post-production within a six-month period.

California: 20% non-transferable tax credits (25% transferable tax credits for indie films), plus 5% for specified expenditures. Minimum spend: $1 million

Colorado: 20% cash rebate. Residency requirement: Productions must hire a workforce comprised of at least 50% resident cast and crew. Minimum spend: $100,000 for Colorado-based production company, $1 million for out-of-state production company.

Connecticut: 10% tax credit (for $100,000-$500,000 in-state expenses), 15% ($500,000-$1 million spend), 30% (over $1 million spend). At least 50% of principal photography or 50% of post-production expenses must occur in-state. Minimum spend: $100,000

District of Columbia: 35% cash rebate on qualified production expenses subject to in-state taxation; 21% rebate on untaxed production expenses on vendors, cast, or crew; 30% rebate on below-the-line resident labor subject to in-state taxation; 10% rebate on untaxed expenses for below-the-line resident labor; 50% rebate on production company’s qualified job training expenditures; plus 25% rebate on production company’s base infrastructure investment. Minimum spend: $250,000

Georgia: 20% transferable tax credits, plus 10% for screen credit. No residency requirements. Minimum spend: $500,000

Hawaii: 20% tax credit (Oahu), 25% (Big Island, Kauai, Lanai, Maui, Molokai). Residency requirement: make reasonable efforts to hire local talent and crew. Minimum spend: $200,000

Illinois: 30% transferable tax credit, 30% for resident labor, plus 15% for resident labor from economically disadvantaged areas. Minimum spend: $100,000

Kentucky: 30% tax credit, 35% for resident labor, 30% for non-resident labor, plus 35% of qualified expenses for economically distressed areas. Minimum spend: $250,000

Louisiana: 25% tax credit on qualified in-state production expenditures (including resident and non-resident labor), 10% for in-state screenplay productions, plus 5% if outside of the New Orleans Metro Statistical Area. Minimum spend: $300,000 ($50,000 for in-state screenplay productions)

Productions can claim additional tax credits of 15% on compensation for services paid directly to a Louisiana resident (except to a loan-out company), plus 5% on qualified visual effects (VFX) spend (if at least 50%, or a minimum of $1 million of the production’s VFX budget is spent in-state).

Maine: 5% tax credit, 10% rebate for non-resident above and below-the-line labor, plus 12% rebate for resident above and below-the-line labor. Minimum spend: $75,000

Maryland: 25% tax credit. Minimum spend: $500,000

Massachusetts: 25% transferable tax credits for production, plus 25% transferable tax credits for labor. No residency requirements. Minimum spend: $50,000

Minnesota: 20% rebate (minimum spend of $100,000 inside metro areas), 25% rebate (minimum spend of $1 million or shoot at least 60% of days outside metro areas). No residency requirements.

Mississippi: 25% cash rebate (30% rebate for resident cast and crew), plus 5% for U.S. veterans. Must include screen credit. Residency requirement: At least 20% of below-the-line labor must be residents. Minimum spend: $50,000

Montana: Discretionary Feature Film & TV grant; resident filmmaker grant of up to $50,000; development grant of up to $50,000 to resident filmmaker or production company for Montana-centric content; film festival grant of up to $5,000 for marketing and travel. Must shoot at least 50% of principal photography in-state. Must include screen credit. Minimum spend: $300,000

Nevada: 15% transferable tax credit on production costs, 15% for resident above-the-line and below-the-line labor, 12% for non-resident above-the-line labor, plus 5% if more than 50% of below-the-line crew are residents, 5% if greater than 50% of the filming days occurred in-state, 5% within Rural County. At least 60% of the production budget, including pre-production, production, and post-production, must be incurred in-state. Minimum spend: $500,000

New Mexico: (1) 25% tax credit. Must shoot at least one day of principal photography in-state. No residency requirements. Minimum spend: $0; or (2) 30% tax credit on resident labor for qualifying TV features.

Additional 5% for (1) resident crew wages if filming at least 10 days at qualified production facilities, such as a soundstage or a standing set (15 days if budget is more than $30 million), (2) straight-to-series pilots where 30% applies to direct production expenditures (except nonresident actors), or (3) television series of at least six episodes budget of at least $50,000.00 each and where 30% applies to direct production expenditures (including payments to nonresident actors).

New York: 30% non-transferable tax credits for most below-the-line expenses, plus 10% for below-the-line wages in select upstate counties for productions over $500,000. No residency requirements. Minimum spend: $0

If you want to learn more, there’s a great article elsewhere on this site on what you should know about New York film tax credit incentives.

North Carolina: 25% rebate of qualified expenses (capped at $5 million for feature films, $9 million (avg) for television series per season, $250,000 for commercials). Must include screen credit. No residency requirements. Minimum spend: $5 million for feature-length films, $1 million per episode for television series, $250,000 for commercials

Ohio: 30% transferable tax credit. No residency requirements. Minimum spend: $300,000

Oklahoma: 35% rebate for resident above and below-the-line expense, plus 2% if a minimum of $20,000 is spent on music created in-state. Minimum spend: $50,000

Oregon: 20% cash rebate on in-state goods and services, 10% rebate on resident and non-resident labor, plus 6.2% on resident labor. Minimum spend: $1 million

Pennsylvania: 25% tax credit, plus 5% if filmed at a qualified production facility. 30% tax credit for post-production expenses incurred at a qualified post-production facility. Minimum spend: 60% of budget

Puerto Rico: 40% tax credit on all payments to residents; 20% for non-resident above-the-line talent; 25% infrastructure tax credit on costs incurred in the development of a film studio or other eligible infrastructure project. Minimum spend: $100,000 for productions, $1 million for infrastructure projects

Rhode Island: 25% transferable tax credit. Primary locations must be within the state. Minimum production budget of $300,000. Minimum spend: $0

South Carolina: 25% cash rebate for resident labor, 20% cash rebate for non-resident labor, 30% rebate for in-state vendor expenses, 20% tax credit (with a cap of $100,000 per taxpayer) to resident investors of an in-state motion picture, plus 20% tax credit (with a cap of $5 million) to resident investors of motion picture production and/or post-production facility. Minimum spend: $1 million

Tennessee: 25% cash rebate on expenses for in-state goods and services and the first $250,000 spent on resident labor. Minimum spend: $200,000 ($250,000 for labor)

Texas: 5% cash grant for in-state expenses and resident labor (for a spend of $250,000-$1 million), 10% cash grant ($1 million-$3.5 million), 20% cash grant ($3.5 million-plus), plus 2.5% cash grant for economically distressed areas. At least 70% of above and below-the-line cast and crew, including extras, must be residents. Must shoot at least 60% of principal photography in-state. Minimum spend: $250,000

Utah: 20% tax credit for in-state spend of at least $500,000, 25% tax credit for in-state spend of at least $1 million, 20% cash rebate for in-state spend of $500,000-$1 million with 75% resident cast and crew (excluding extras and five principal cast members), 20% cash rebate for in-state budget of $500,000 or less with an in-state spend of $20,000-$500,000 and 85% resident above and below-the-line cast and crew.

Virginia: 15% tax credit (20% for economically distressed areas), plus 10% tax credit on resident labor for in-state spend of $250,000-$1 million or 20% tax credit on resident labor for in-state spend of $1 million or more, plus 10% tax credit on resident labor for first-time actors or crew. Discretionary grant also available. Minimum spend: $250,000 (no minimum for grant)

Washington: 30% tax credit for film, 35% for TV series with six or more episodes, 15% for non-resident labor (if at least 85% production company’s labor force are residents). Minimum spend: $500,000 for film, $300,000 for TV

West Virginia: 27% transferable tax credits, plus 4% if employing at least 10 residents full time. Minimum spend: $25,000

Wyoming: 12% cash rebate for resident labor and in-state vendors, 13% for in-state props and product placement, 14% for in-state behind-the-scenes footage, 15% for Wyoming-set storyline, plus 12% to include screen credit. Must include screen credit. Minimum spend: $200,000