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Tom is a filmmaker, producer, and marketing specialist based in Los Angeles.
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.
From the iconic skyline of NYC to the scenic landscapes of the Adirondacks, New York offers a diverse and vibrant backdrop that will add beauty and character to any film or TV production. In fact, New York is just as much a character as the actors that appear in any of thousands of films and series shot in the Empire State.
And since the state's robust infrastructure, skilled workforce, and rich cultural heritage make it an ideal location for filmmakers seeking both urban and rural settings, it’s no wonder that so many productions shoot in New York.
Film production tax incentives are tax benefits offered throughout the United States to encourage in-state film production.
These tax credits for film started in the 1990s after similar Canadian incentives sent movie productions packing for the land of maple and hockey. Since then, states have offered increasingly competitive incentives to win productions away from other states.
Since the NY film tax credit program’s inception in 2004, New York has remained a front-runner when it comes to film tax incentives, offering one of the most competitive packages in the nation. The current New York film tax credit programs makes the state a top filming destination.
To learn more about the different incentives that states offer, check out Wrapbook’s Production Incentive Center.
The New York film tax credit is a powerful incentive for production companies. The Empire State offers a fully refundable, non-transferable tax credit of 30%–40% based on qualified production expenditures incurred in the state.
We’ll walk through exactly what this means—and which production expenditures qualify—below. But first, a brief, general overview of tax incentives and how they work.
While film industry tax incentives cover a broad range of things from fee-free locations, to sales tax exemptions, to lucrative cash grants, New York’s primary method of incentivizing film production is film production tax credits.
Film tax credits cancel a portion of the income tax owed to the state by the production company. But a lot of production companies are limited purpose business entities and have little-to-no income tax liability. If your production company falls into this camp, don’t sweat it!
In essence, film tax credits are tax rebates, and the exact amount of your film tax rebate is based on a number of eligible expenses.
Importantly, the NY film tax credit is fully-refundable.
If a production company does not have any tax liability, the full amount of the credit is rendered as a tax refund. If the production company does owe income tax, the amount owed is first reduced by the amount of the credit. In both cases, productions can expect to receive New York tax breaks.
It’s also important to note that the NY film tax credit is non-transferable.
Non-transferable tax credits cannot be resold; they must be used by the production company to whom they were awarded.
The New York film tax credit comes with a $1,000,000 minimum spend requirement for productions shot in Westchester, Rockland, Nassau, or Suffolk County or any of the five New York City boroughs, meaning that these productions must spend at least $1 million in the state to qualify for a film tax credit.
The program also has a $700,000,000 annual cap, meaning that $700 million is available for allocation each fiscal year, and no project caps—there is technically no limit to the amount of money productions can receive back in tax credits within the annual and compensation cap requirements (see below for more on compensation caps).
Which companies get awarded these coveted New York State film tax credits? Well, that brings us to…
The NY film tax incentive is a 30%–40% tax credit on qualified costs incurred in New York State for eligible productions that fall into one of four categories:
An extra 10% NY film tax credit is available for labor costs incurred in upstate New York.
The simple answer? A lot. Most broadly, everything from wages paid to cast and crew to physical production expenses like equipment rentals and property used or obtained in New York State can all be covered by the New York film tax credits.
When thinking about what expenses will qualify for a NY film tax credit, it’s useful to think of your production costs falling into one of three buckets.
The first, and often largest, portion of production expenditures include cast and crew payroll. In structuring its film tax incentive program, the New York Film Office makes determining the credit productions can see for payroll fairly easy to understand.
All cast and crew payments, including those to above-the-line residents, above-the-line-nonresidents, below-the-line residents, and below-the-line nonresidents, qualify for a 30%–40% tax credit.
There is a compensation cap for above-the-line cast and crew of $500,000 and 40% of total New York spend, meaning that only the first $500,000 paid to above-the-line cast and crew can qualify for the tax credit and above-the-line payments are limited to no more than 40% of the total New York production spend.
Along with cast and crew payroll expenses, New York offers a tax credit of 30%–40% for physical production expenses. This means productions can get back 30%–40% of every dollar spent on physical goods used and incurred in the state of New York.
You might then be asking why the 30%–40% range? How do you get a credit for 40% of your production spend instead of 30%? Well, that’s where bonuses come in.
The New York film tax credit program offers a generous upstate bonus of 10% on qualified labor expenses incurred in certain upstate counties, including:
Productions must have a qualified spend of at least $500,000 in order to qualify for the upstate bonus.
Effective until 2034, there is a maximum of $5,000,000 per year that can be allocated for the upstate bonus.
Upstate productions in the counties specified above shall include qualifying above-the-line salaries incurred in those counties as eligible for the 10% additional credit.
In addition, if the production company shoots more than 50% of principal photography days in the specified counties, all other qualified costs incurred in those counties are eligible for the 10% additional credit.
Post production costs such as film editing, sound design and effects, and visual effects may also qualify for the New York film tax incentive with production credit available for productions that film a significant portion outside of New York State but intend to contract some or all of post production in New York.
So even if your production requires you to shoot on-location in the Himalayas or send your second unit to a tropical island, you may still be eligible for New York State tax credits.
In addition to the post production film tax credit, New York offers a 20% fully refundable tax credit for commercial productions. Currently, the New York commercial tax credit program has an annual funding cap of $7,000,000. Commercials filmed upstate must meet a minimum spend requirement of $100,000 and commercials produced downstate must have a minimum spend of at least $500,000.
The newest entry into New York’s competitive production incentive offerings, the Empire State now offers a 25%–35% fully refundable digital gaming tax credit. The digital gaming tax credit has $5,000,000 in funding allocated for the 2024 fiscal year and productions must have a minimum spend of at least $100,000 to qualify.
Productions filming in the greater Syracuse area (Onondaga County) can take advantage of a 25% film tax rebate provided they conduct 70% of principal production in Onondaga County, meet the program’s minimum spend requirements, and meet the rebates other qualifying requirements.
First and foremost, a production company can’t claim both the film production and post production credits for the same costs—if you are conducting production and post in New York, all qualified expenditures would be credited under the film production tax credit.
Other requirements include submitting a diversity plan and adhering to a budget that reflects realistic spending, as inflated numbers can lead to reduced credits.
Feature films must have a runtime of at least 75 minutes to qualify for the production film tax credit and TV episodes must have a runtime of at least 30 minutes with commercials.
For independent productions with a budget under $15,000,000 must shoot at least one day of principal photography at a qualified production facility. The program defines qualified independent production companies as ones in which no more than 5% of the beneficial ownership is owned directly or indirectly by a publicly traded entity.
If your production has a budget over $15,000,000 or is produced by a company in which more than 5% of the beneficial ownership is owned, directly or indirectly, by a publicly traded entity, you must shoot at least 10% of the total principal photography days at a qualified production facility.
The NY Film Tax Credit program accepts rolling applications, with the recommendation that all applications are submitted at least 10 business days prior to the first day of principal photography.
Applicants are asked to complete a project summary form and submit it along with a budget and calculated budget cost qualifier as part of their initial application.
As of 2023, applicants must also submit a diversity plan that explains how the production will hire a diverse workforce, as well as whether the production will take part in workshops and training exercises designed to promote a labor force as diverse as the state.
When the initial application is complete, the New York Film Tax Credit Program office will notify the applicant that they can proceed toward a final application.
Most productions will then proceed onto production, and once post-production is complete, submit their final application with more extensive budgeting documentation. Once this final application is complete, the application is ready for audit.
Following a successful audit, the NY film tax credit is certified and issued to the applicant listed on the final application.
With the Post-Production tax credit, applications must be in before incurring any qualified costs in New York State.
The application’s website recommends submitting the initial application before the start of principal photography on the qualified film or TV pilot and not later than the last day of principal photography.
For a television series, they suggest submitting by the last day of principal photography on the first episode of the series.
Full details, including guidelines and checklists for the NY film tax credit application can be found here.
In all cases, you will be required to tag and track your production budget, so it’s important to make sure you have a good budgeting workflow in place.
Utilizing a NY film tax credit can significantly offset the cost of your film. While navigating the application process may seem daunting, the financial benefits are substantial.
If you're also considering filming in California, check out our guide to California film tax credits, or for a broader view, explore our state-by-state incentive breakdown at Wrapbook’s Production Incentive Center. Here, every filmmaker can find valuable information to make the most of film incentives across the United States.
Welcome to the Empire State where the bright lights of Broadway meet the quiet charm of upstate. New York has captivated audiences in countless classics ranging from King Kong to When Harry Met Sally to the fast-paced series Mr. Robot.
But navigating the financial aspects of film production can be as complex as city traffic. That's where New York’s film tax credits come into play, designed to streamline your production expenses while maximizing your creative potential.
Whether you’re setting up an indie project in the Catskills or launching a blockbuster in the bustling streets of Manhattan, understanding and utilizing these incentives can significantly reduce your budget. With their benefits, you can then allocate funds to where they count most to bring your cinematic vision to life.
From eligibility criteria and qualifying expenditures to insightful tips on navigating the application process, this guide is your all-access pass to NY film tax credits. In this article, we will break down the New York film tax credit program: what it is, how to apply, and how a NY film tax credit could help your next production save big.
Before we begin diving into the NY film tax credit program, we invite you to visit Wrapbook’s comprehensive Production Incentive Center.
The Production Incentive Center is your go-to destination for all things film tax incentives. Check out features like the State Incentive Map, which allows you to 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.
And while Wrapbook can help you learn about incentives all across the country, in this article, we will focus specifically on the New York film tax credit program.
