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Welcome to the Land of 10,000 Lakes where picturesque landscapes meet a thriving arts scene. Minnesota is more than just a hub for culture and creativity; it's also a burgeoning destination for filmmakers looking to maximize their production budgets.
Thanks to the Minnesota film tax credit, producers can now capitalize on significant savings while enjoying the state's diverse locations and talented workforce. In this comprehensive guide, we'll explore how to take advantage of the Minnesota film tax credit to maximize your production budget.
Before diving into the specifics of the Minnesota film tax credit, we invite you to explore Wrapbook's Production Incentive Center. This comprehensive resource provides detailed information on film incentives across the United States, making it easier for you to compare and choose the best location for your next project.
With tools like the State Incentive Map, easily navigate incentive options across the country. Or give the Incentive Comparison Tool a spin and learn how film tax incentives from different states stack up beside each other.
You can even talk to an AI Incentives Expert to learn about the latest legislation and to get a clear, concise explanation of how to make incentives work for you.
Wrapbook’s Production Incentive Center puts nationwide production incentive information at your fingertips, simplifying the complexities of navigating Minnesota film tax incentives and others across the country.
Minnesota offers a unique blend of urban and rural settings, from the bustling streets of Minneapolis and St. Paul to the serene beauty of its lakes and forests. This geographic diversity, paired with Minnesota’s four seasons, make the state an ideal backdrop for a variety of productions.
Beyond its natural beauty, Minnesota boasts a talented pool of local crew and a supportive film community. The state's commitment to fostering a vibrant film industry is evident through its robust Minnesota film tax incentives, which significantly reduce production costs while maintaining high-quality standards.
In recent years, Minnesota film tax credits have made possible feature films like Downtown Owl and Marmalade, as well as television series, with an upcoming season of Netflix’s Love Is Blind filming in and around the Twin Cities.
Minnesota has long been a leader in production incentives. In 1997, the state introduced the Minnesota production rebate, nicknamed the “Snowbate,” administered by the Minnesota Film and TV Board through the Department of Employment and Economic Development (DEED).
While the Snowbate still exists and provides incentives to qualifying projects, in 2021, Minnesota bolstered its production incentives by introducing the Minnesota film tax credit program. The MN film tax credit program aims to create jobs, stimulate local businesses, and promote Minnesota as a premier filming destination.
Recent legislative updates have continued to expand the program, increasing annual funding and extending its authorization until December 31, 2030. These enhancements make Minnesota film tax incentives more accessible and lucrative for productions of all sizes.
Following the creation of the tax credit program in 2021, Minnesota established a new film office in early 2024 to help administer tax incentives and support filmmaking throughout the state.
Replacing the previous Minnesota Film and TV office, the new Explore Minnesota Film office now serves as a valuable resource for filmmakers by encouraging local production through a number of programs.
With their location guide, Explore Minnesota Film helps filmmakers scout the state’s diverse range of locations before even touching down in the North Star State.
Explore Minnesota Film’s production directory helps connect productions with talented professionals and production gear available throughout the state, while their permitting guide provides a clear and convenient breakdown of all permits that might be required when shooting in the state.
Finally, Explore Minnesota Film is committed to supporting and growing the filmmaking community in Minnesota through training and development programs for people of all experience levels, from teen-centered youth programs to career workshops for production veterans.
With all of these programs, the film office is committed to promoting the state's film industry and ensuring that productions have the support they need to succeed. One of the most prominent ways Explore Minnesota Film encourages filmmaking in Minnesota is with the film tax credit program.
The Minnesota film tax credit program offers a fully transferable film tax credit of 15% to 25% on qualifying production expenses.
Transferable tax credits can be sold or transferred to another taxpayer if the production company doesn't have sufficient tax liability. In Minnesota, these tax credits are also termed “assignable tax credits.”
Minnesota film tax credits come with a $1 million minimum spend requirement, meaning that production companies must spend at least $1 million in a consecutive 12-month period on eligible production costs within the state to qualify.
The program also has no project caps, which can be a huge boon to productions because it means there is no maximum amount that can be awarded to a single project.
The Minnesota film tax credit program has an annual allocation of $24,950,000, with unused funds rolling over to subsequent years, ensuring ample opportunity for productions to benefit from Minnesota film tax incentives.
In addition to the Minnesota film tax credit program, Minnesota also still offers the MN production rebate, or “Snowbate,” a rebate of 20% to 25% on qualifying expenses.
Film rebates are state funds paid directly to a production company for qualifying expenditures. Unlike film tax credits, which can be claimed only after a production company files a tax return with the state, rebates do not require producers to file a return.
Ryan Broussard, Wrapbook’s VP of Sales and Production Incentives, describes film tax rebates as essentially “buckets of cash” that can be accessed by productions that meet certain requirements.
Annual funding for the Minnesota production rebate is set at $500,000. Minimum spend requirements for the rebate and the rebate amount differ depending on project type.
Feature films, documentaries, music videos, new or relocating television series, and television pilots can be eligible for up to a 20% rebate if these productions meet a qualified minimum Minnesota spend of at least $100,000 and 50% of the budget is available in verified funds at the time of application.
The rebate amount for these productions bumps up to 25% if they meet a qualified minimum Minnesota spend of at least $1 million OR shoot a minimum of 60% of days outside the metro area with qualified minimum Minnesota spend of $100,000.
Television or internet commercials and post production projects can be eligible for a rebate of up to 25% if these projects meet a qualified minimum Minnesota spend of $100,000.
A wide range of productions can benefit from the Minnesota film tax incentives, including:
Certain types of productions are not eligible for Minnesota film tax incentives, such as:
Eligible production types are the same for both the Minnesota film tax credit and the Minnesota production rebate.
Qualified expenditures are core to the Minnesota film tax credit program and encompass a wide range of production-related costs. From wages paid to cast and crew to physical production expenses like equipment rentals and location fees, these expenditures are an essential component to consider when maximizing your eligibility for Minnesota film incentives.
The first, and often largest, portion of production expenditures includes compensation for cast and crew. Minnesota makes budgeting for the payroll credit fairly straightforward.
Below-the-line residents are eligible for a 25% film tax credit, with no cap on the amount of compensation. Above-the-line residents, including producers and directors, are also eligible for a 25% credit on compensation, but the eligible expense is capped at the first $500,000 in wages per individual, provided that required Minnesota withholding taxes are remitted. Individuals holding multiple positions are only eligible once.
Additionally, Minnesota expanded credits for below-the-line nonresidents as well. Projects that spend at least $5 million in qualified Minnesota expenditures are eligible for a 15% credit on below-the-line compensation paid to nonresidents employed in Minnesota. Qualifying projects are expected to continue employing Minnesotans to the extent practicable.
For nonresident above-the-line personnel, the film tax credit applies to compensation paid to all non-resident principal acting talent, one non-resident producer per episode, and one non-resident director per episode.
The eligible expense for these individuals is capped at the first $500,000 in wages per person, provided that required Minnesota withholding taxes are remitted. Individuals holding multiple positions are only eligible once.
Additionally, eligible expenses paid to a producer are capped at no more than 10% of the total qualified expenditures.
Per diems and housing allowances paid to Minnesota residents and non-residents while working in Minnesota are also eligible, as long as payments are not made in cash.
Along with cast and crew payroll expenses, Minnesota offers a 25% tax credit (and rebate) for physical production expenses.
Whether you’re renting equipment, building sets, paying for crafty, or managing any other production costs that come up over the course of a shoot, the physical spend credit is a component of the program that can help return money to your production budget.
To qualify for the Minnesota film tax credit, productions must meet certain criteria outlined by Explore Minnesota Film and the Minnesota DEED.
First, productions must demonstrate their project is at least 75% funded when applying for a Minnesota film tax credit and 50% funded when applying for the rebate.
Productions must agree to promote Minnesota by visibly displaying a static or animated logo approved by Explore Minnesota Film in the project’s end credits (television commercials are exempt).
Productions must also employ Minnesota residents to the extent practicable.
Finally, productions must obtain a tax clearance statement from the Minnesota Department of Revenue and remain in good business standing with the Minnesota Secretary of State.
Securing Minnesota film tax credits can significantly enhance your production’s budget, but understanding the application process is crucial.
Here's a step-by-step guide to help you navigate the requirements and successfully apply for Minnesota film tax incentives:
1. Before beginning the application for Minnesota film tax credits, first gather proof of funding, detailed budgets, production schedules, and employment plans so you have all the materials that the application will require at hand.
2. Once you have all the material, fill out the application form provided by the Minnesota DEED.
3. For the tax credit, apply at least 30 days but not more than 180 days prior to beginning principal photography in Minnesota. For post-production-only projects, apply at least 30 days but not more than 90 days prior to beginning work.
4. For the rebate, submit a completed application no earlier than 90 days prior to the start of Minnesota principal photography or post-production.
5. Once completed, send your application and inquiries to FilmInMN.DEED@state.mn.us. Applications are reviewed on a first-come, first-served basis until funds are fully allocated.
Once your application is accepted you will receive a Tax Credit Certificate. DEED will issue a Tax Credit Certificate for the taxable year in which your 12-month expenditure period ends.
The rebate is awarded on a point system based on economic impact, key personnel, Minnesota production days, Minnesota location and representation, and distribution.
Report the Minnesota film tax credit on your state tax return for that year. If desired, you may assign your tax credit to another taxpayer before claiming any portion of it.
In order to give your project that best chance at being awarded a Minnesota film tax credit, contact DEED early in your planning process to make sure you understand all requirements, regularly check for program updates or changes in funding availability, and consider hiring a local accountant familiar with Minnesota film tax incentives.
In addition to the statewide Minnesota film tax credit, several regional incentives enhance the financial appeal of filming in the state. These regional programs can be combined together and with the Minnesota film tax incentives to maximize your production's savings when applicable.
The Iron Range Regional Production Incentive Program offers a reimbursement of up to 20% of production and post-production expenses incurred within the Iron Range Resources & Rehabilitation service area, also known as the Taconite Assistance Area.
This incentive is designed to develop and maintain a strong production industry presence in northeastern Minnesota. With funding up to $500,000, productions can significantly reduce costs by filming in this region, which offers unique landscapes and a supportive local community.
St. Louis County provides a production incentive program that offers a rebate of up to 25% on production and post-production expenses spent within the county. Administered by the Upper Midwest Film Office (UMFO), this program aims to encourage the creation of film, television, and digital media content in St. Louis County.
With funds up to $1 million, it's an attractive option for productions looking to capitalize on Minnesota film tax incentives while exploring the scenic beauty of the area.
In partnership with the Duluth Economic Development Authority (DEDA), the City of Duluth Production Incentive Program offers a reimbursement of up to 25% of production and post-production costs incurred within the city.
With funding up to $200,000 and a minimum spend of $10,000, this incentive is ideal for productions of various sizes. Duluth's urban landscapes and natural settings provide a versatile backdrop, and this program can be combined with the Minnesota film tax credit and other regional incentives.
The Incredible Austin Minnesota Film Rebate provides a 10% reimbursement, up to $10,000 per project, for eligible expenses incurred within the city of Austin, MN.
This program encourages film, television, and digital media production in Austin, offering a charming Midwestern backdrop for various projects. Productions can use this rebate alongside the Minnesota film tax incentives to further reduce costs.
The City of Maple Lake offers the Shamrock Film Rebate, providing a 15% rebate on qualified production costs, with a maximum rebate of $7,500 per production.
Aimed at attracting movie and television productions to the city and supporting local businesses, this incentive can be combined with the Minnesota film tax credit and other regional programs. Maple Lake's quaint settings make it an appealing location for productions seeking a small-town atmosphere.
Minnesota's combination of diverse locations, talented professionals, and generous Minnesota film tax incentives makes it an excellent choice for your next production. By understanding and leveraging the Minnesota film tax credit, you can significantly reduce your production costs while contributing to the state's growing film industry.
For a comprehensive comparison of film incentives across the United States, visit Wrapbook's Production Incentive Center. Start planning your Minnesota production today and unlock the financial benefits that await in the majestic Land of 10,000 Lakes.
At Wrapbook, we pride ourselves on providing outstanding free resources to producers and their crews, but this post is for informational purposes only as of the date above. The content on our website is not intended to provide and should not be relied on for legal, accounting, or tax advice. You should consult with your own legal, accounting, or tax advisors to determine how this general information may apply to your specific circumstances.
Tom is a filmmaker, producer, and marketing specialist based in Los Angeles.
