Massachusetts

The field of production can sell tax credits to MA taxpayers. On the flip-side, you can restore tax credit with the State for cash. That rate is 90% of the tax credits collected. This is known as transferable and redeemable tax credit. Regarding rates, production receives 25% on qualified production expenditures, which includes nonresident rectification. The cap for individual compensation is $1M. But if you do half of your principal photography days or half of your total production expenditures in MA, there is no cap. The minimum spend is $50k. Additionally, independent CPA cost verification is required, and you cannot earn credits with the state after transferring them to another individual or entity. Sales tax exemption for production expenditures is also available.

Georgia

has transferrable tax credits, meaning that production can sell tax credit to the state’s taxpayers. Rates run at 20% on certified expenditures, including nonresident compensation, with an added 10% if the production holds end credit/exceptional GA promotional material. Basically, most productions are qualified for 30% total rate. Not applying to payments made to loan-outs, there is an individual compensation cap of $500k, which is also the minimum spend number. Unlike MA, there’s no required final certification process, but the state offers a “verification review” at $55/hour per state auditor. This insulates purchasers of certified credits from recapture.

Louisiana

has redeemable tax credit where production can exchange tax credit for cash at an excellent rate of 88% of the tax credits earned after paying for the transfer fees. With a 25% base rate on certified production expenditures, there’s a 5% increase to the base rate if over 60% of production takes place outside of metro New Orleans. These area-oriented rules should be thoroughly researched before addressing redeemable tax credits. LA has a $150M annual reservation cap, which can possibly allocate from future years (if exhausted). Additionally, there is a $180M annual cap on tax credits held with the state. These events can unfortunately delay the monetization of credits.

Hawaii

This tropical state offers refundable tax credits where production receives a cash refund after filing tax return. This state’s rates are 20% on certified production expenditures with a 5% extra credit for production in counties outside of Honolulu County. $15M is the tax credit cap per production with a minimum spend number of $200k. Many expenditures involving, and subject to, Hawaii tax are eligible. This includes the cost of flights and shipping equipment to and from Hawaii.

New Mexico

the type of incentive is refundable tax credit, so production obtains a cash refund after submitting tax return. This states rates include: 25% on certified production expenditures for film; 30% certified production expenditures for television; 30% regarding resident BTL crewmembers when working in a qualified production facility; and 15% on nonresident BTL crewmember compensation (when meeting many conditions, like a high level of production activity). The annual claims cap in NM is $50M, and the minimum spend number is $500k for TV/features while the minimum for music videos/soundtracks is $50k.

Mississippi

Resident Payroll Rebate (30%) A production is eligible for a 30% cash rebate on payroll paid to resident cast and crew whose wages are subject to Mississippi Income Tax Withholding and for that portion of their salary for the project up to and including $5 million. (The employee must live in Mississippi, or maintain a home here and spend more than 6 months in the state.) For purposes of this program, payroll means salary, wages, or other compensation including related benefits paid to employees upon which Mississippi income tax is due, has been withheld, and has been paid. Loan outs qualify with a 5% withholding fee. Honorably Discharged Veteran Payroll Rebate (5%) A production is eligible for an additional 5% cash rebate on payroll paid to any member of the cast or crew who is an honorably discharged veteran of the United States Armed Forces. Note: The Mississippi Income Tax Withholding Rate is 3-5%. The tax rate for loan outs is 5%. This must be paid for loan outs to qualify. Sales and Use Tax Reduced Rates Production equipment and machinery used directly in the filming and/or editing of a project may be taxed at the reduced rate of 1.5%, as stated in Section 27-65-11 and Section 27-65-17 of the Mississippi Code of 1972. The following production equipment is eligible for this reduced rate: * Audio equipment * Camera equipment * Lighting equipment * Projection equipment * Sound equipment * Computer equipment used for animation, editing, or special effects A production must register for a use tax number and a Direct Pay Permit online through the Mississippi Department of Revenue website, www.dor.ms.gov, in order to access the reduced tax rate. All relevant Department of Revenue documents must be completed, submitted to the Department of Revenue, and approved by the Department of Revenue before sales and use tax reductions can be taken. A production may register immediately upon being approved into the Mississippi Motion Picture Incentive Program by the Mississippi Development Authority (MDA).

Let us handle the paperwork

As you keep plugging away at that development process, we will handle the paperwork and/or the logistics of filming in any of these locations. We can handle the heavy lifting.