History of TAx Law Credits
The US remains one of the dominant centers in the world for movie production. Movie production companies operating as LLCs continue to have large budgets to create incredible films. The films employ many individuals in a variety of fields. This has led states passing laws to offer tax incentives for the production houses.
Tax Law Credits in the United States began primarily because Canada wanted to attract some of the big blockbuster films to their country. In response, many States in the U.S. started offering their own form of tax credits.
Some of those tax incentives include:
1) tax credits,
3) sales tax exemption, and
4) lodging exemptions.
Georgia's Tax Law Credits
The State of Georgia is growing at a top place to film movies. It has a very diverse landscape which includes mountains, islands, the city life.
One of the main tax law advantages that Georgia offers for movies and small films is that the tax credits are transferable. This allows filmmakers to sell any excess amount of tax credits they have leftover to another movie. Therefore, filmmakers can save on taxes and create an additional revenue stream by selling the tax credits. Filmmakers can contact brokers who have connections with buyers and sellers of film tax credits.
There is an additional 10% if a production company includes the “Made in Georgia” line in the credits of the film.
The minimum investment to qualify for these tax credits in Georgia, as of this writing, is $500,000.
New York's Tax Law Credit
New York has always been a destination for filming movies and small independent films. The State offers some of the best tax credits in the country. This helps filmmakers with a reduction of up to 40% on labor costs and 45% post-production cost.
The State of New York is geographically diverse and unlike any state in the country. Not only does it have the mountains, the State also has New York City the most populated city in the country. New York City's building architecture is unlike any other city in the country.
If a Filmmaker's film is under 15 million, he or she can benefit from tax credits in the State of New York. The main requirement is to shoot the entire film in one day and at one of the 90 of the qualified production sites that New York has to offer.
Massachusetts' Tax Law Credits
The State of Massachusetts has some of the top universities in the world. Many of these students create excellent small and independent films. These filmmakers can benefit from the generous tax credits that Massachusetts offers.
The State of Massachusetts give generous tax credits in the 3 areas:
1) 25% production credit,
2) 25% payroll credit, and
3) Sales tax exemption.
The State offers a Payroll Credit which allows the film investment to be spread across 12 months. The payroll payments can only be counted for employees making less than $1 million.
Massachusetts tax credits are also transferable. This means that once the filmmaker uses the tax credits against the movie expenses if there are any leftover film tax credits, the filmmaker can sell the excess credits to another filmmaker.
The minimum requirement is $50,000.
California's Tax Law Credits
Hollywood has many of the largest movie production companies. The budgets for the movies can be in excess of $100 million. These movies attract and employ many of the best actors, actresses, directors, and movie technicians.
Some of the tax credits from California are up to:
1) 25% for television series that relocate to the state with a $1 million investment\
2) 25% transferable credit for independent films with a $1 million investment.
3) 20% for television pilots with a $1 million minimum budget and are at least 40 minutes in length, and
4) 20% for feature films with a $1 million minimum budget.