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Navigating the landscape of film incentives can be a daunting task for even the most seasoned producer. To help demystify the process, Wrapbook’s Ryan Broussard has compiled a comprehensive overview of key updates to more than a dozen state incentive programs.
This in-depth analysis breaks down the latest legislative session updates from the last eight to 12 months, as well as eligibility requirements and potential benefits for filmmakers considering various locations across the United States.
From established powerhouses like California and Georgia to emerging markets like Missouri and Arizona, this roundup provides essential insights for maximizing production budgets and streamlining the incentive application process.
Dive deeper into these program updates and gain valuable industry insights by watching Wrapbook's virtual event Incentives Summer Roundup, which took place on August 8, 2024. This comprehensive session features Broussard's presentation in its entirety, offering a detailed exploration of film incentive updates across the nation as of that date.
Sign up to view the recorded video and gain a competitive edge in navigating the ever-evolving landscape of film production incentives. Please note that any state incentive programs that have undergone updates after August 8, 2024, will not be reflected in the recording.
Broussard, Wrapbook's VP of Sales and Production Incentives, brings over 16 years of industry experience to the Wrapbook team. With a deep understanding of film production incentives, Broussard has a proven track record of helping productions maximize their financial potential.
His expertise spans from crafting strategic incentive plans to streamlining audit processes. Broussard's insights have also influenced the design of incentive programs across various states.
Broussard discussed these 13 states during our virtual event. For the most up-to-date information on all state incentive programs, visit our Incentive Production Center. You'll find detailed information on eligibility requirements, application processes, and available incentives for each state.
Arizona has recently introduced a film incentive program that offers a refundable tax credit. While the program holds promise, certain aspects require careful consideration.
The credit offers a tiered structure based on production spending within the state. However, to qualify, productions must meet specific criteria. They must either film at a qualified production facility or primarily at a practical Arizona location.
Additionally, all pre-production, post-production, and editing must typically be performed in-state. While the state offers waivers for post-production and editing, securing approval for these exemptions requires communication with the film office.
Interestingly, meeting these criteria can also result in a bonus credit, increasing the potential return on investment. However, the specific requirements for this bonus are complex and may require clarification on a case-by-case basis.
Arizona has also implemented a notification process for productions intending to apply for the incentive. While the state offers multiple options for fulfilling this requirement, the simplest method involves providing a letter of intent outlining production start dates and locations.
It's important to note that while Arizona offers a refundable tax credit, a CPA is required for the application process and associated fees are not eligible for the credit. Additionally, the state has introduced a real savings vendor program which provides discounts to productions using Arizona-based vendors.
While Arizona's film incentive program presents opportunities, filmmakers should carefully review the eligibility criteria and bonus structure. Effective communication with the Arizona Film Office is essential to navigate the program's complexities and maximize potential benefits.
To learn more about Arizona’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
California, a longstanding hub for film and television production, offers a competitive tax credit program. While the state has made strides in recent years, navigating its incentive structure requires careful attention.
Currently, California operates under Program 3.0, which features strict application windows and limited funding. The program offers a transferable tax credit for independent films, with potential for additional incentives based on factors like local hiring and out-of-zone filming.
Looking ahead, Program 4.0 is on the horizon, promising increased funding and a new refundable option. While the refundable option may appeal to certain productions, it's essential to weigh the benefits against potential drawbacks, such as the 90% buyback and five-year distribution period.
California is also introducing mandatory diversity requirements for future tax credits, which will impact eligibility and credit amounts. While specific details are still forthcoming, productions should begin developing diversity and inclusion plans to maximize their chances of qualifying for the program.
Despite challenges, California remains a desirable filming location. However, understanding the intricacies of the tax credit program and planning well in advance are crucial for success.
To learn more about California’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Colorado has made significant strides in bolstering its film incentive program. The state has transitioned from a grant-based system to a refundable tax credit, offering a credit of 20% to 22% of qualified expenses. This change provides greater certainty for filmmakers as funding is no longer subject to annual state budget appropriations.
To qualify for the credit, productions must employ at least 50% Colorado residents. While the refundable tax credit is a positive development, it's essential to note that the state still requires proof of full funding before approving incentives. This can present challenges for productions, especially independent films, that rely on securing financing throughout the production process.
The Colorado Film Office has been proactive in supporting the industry, and the extension of the sunset date for the tax credit indicates a long-term commitment to film production in the state.
While Colorado's program has improved, it's important to consider these factors when planning a production in the state: the requirement for a significant portion of the crew to be Colorado residents and the need for upfront proof of funding.
To learn more about Colorado’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Connecticut boasts a robust film incentive program that has successfully weathered recent challenges. Despite facing a proposed elimination, the program persevered, maintaining its status as a valuable tool for the state's film industry.
Offering a transferable tax credit of up to 30% based on production expenditures, Connecticut has attracted a diverse range of productions, including reality television and post-production work. The program's continued stability provides a strong foundation for filmmakers considering the state as a production location.
Connecticut's successful defense of its film incentive program is a testament to the program's positive impact on the state's economy and its appeal to the film industry.
To learn more about Connecticut’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Georgia remains a top choice for film and television production, thanks in large part to its robust tax incentive program. Recent attempts to cap or reduce the program have been unsuccessful, ensuring its continued viability.
While the program's core structure remains intact, Georgia has implemented a gradual reduction in the withholding rate for loan-outs, providing additional financial benefits to productions. This change, along with the program's existing generous tax credit, solidifies Georgia's position as a leading film production destination.
To learn more about Georgia’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Hawaii offers a competitive film incentive program with a refundable tax credit of 22% for productions filmed on Oahu and 27% for those filmed on the neighbor islands. The credit includes both above and below-the-line expenses, as well as residents and non-residents.
While the program has maintained its core structure, there have been significant improvements in the application and approval process. Notably, the state has introduced a 30-day grace period for addressing issues raised during the final application stage, providing filmmakers with more flexibility.
While audits are no longer mandatory, they are strongly encouraged to ensure compliance and maximize credit eligibility. However, it's important to note the introduction of additional fees, including a contribution to public schools or universities, which should be factored into production budgets.
Despite these changes, Hawaii's strict deadline for final tax return filings remains in place, emphasizing the importance of careful financial planning and adherence to program guidelines.
To learn more about Hawaii’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Illinois has long been a popular filming location, thanks in part to its competitive film incentive program. Last year saw significant enhancements, particularly for above-the-line talent.
The state offers a generous tax credit of 30% to 45%, with an additional 15% available for productions filmed in designated economic interest areas. A major breakthrough came last year when Illinois expanded eligibility for the above-the-line credit to include non-residents, significantly boosting its appeal to productions.
Another positive development is the inclusion of unscripted programming in the incentive program. This expansion now covers talk shows, contest shows like Big Brother, and game shows. This move demonstrates Illinois' commitment to supporting a diverse range of productions.
While the above-the-line credit is beneficial for many roles, it's important to note that hosts of unscripted shows do not qualify for this credit.
These updates solidify Illinois' position as a desirable filming location and will likely attract a wider range of productions to the state.
To learn more about Illinois’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Maryland has strengthened its position as a film-friendly state with enhancements to its incentive program. The state increased its refundable tax credit from 28% to 30%, making it even more attractive for productions.
Additionally, Maryland has streamlined its Film Office by incorporating it into the Department of Commerce, potentially improving efficiency and communication within the state government.
To learn more about Maryland’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Missouri has emerged as a compelling filming location with the recent implementation of its film incentive program. Offering a generous 42% tax credit, inclusive of both residents and non-residents, as well as above and below-the-line talent, the state has positioned itself competitively.
A standout feature of the Missouri program is as Ryan calls it a "blanket bonus" structure, where additional incentives are applied to the entire project rather than specific components. These bonuses include credits for filming in rural areas, utilizing local crew, portraying Missouri positively, and shooting in specific counties.
To streamline the application process, Missouri has implemented a 10-day approval period. However, production companies must be prepared to start filming within 14 days of approval. The state also requires proof of 100% funding before allocating incentives.
Missouri has expanded its focus on digital media, including augmented reality and virtual reality, and offers a standalone post-production and VFX credit. Additionally, the state has implemented a relatively swift turnaround time for incentive payouts, with a goal of processing final audits within 10 days.
It's important to note that while Missouri's incentives are promising, an issuance fee applies to the tax credit. Furthermore, Kansas City maintains its own grant rebate program, which can be stacked with the state incentives.
These factors combined make Missouri an attractive option for filmmakers seeking a lucrative incentive package and expedited turnaround times.
To learn more about Missouri’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
New Jersey has significantly enhanced its film program to attract production companies. Key improvements include a transferable tax credit, no project cap, and several targeted incentives.
The state has increased the compensation cap for qualified individuals to $750,000, up from $500,000. Additionally, Pennsylvania residents working in New Jersey can now qualify for the tax credit. The issuance fee structure has been streamlined into a tiered system for easier budgeting.
To ensure accurate tax collection, loan-outs must now be authorized to conduct business in New Jersey. The diversity bonus, which offers additional tax credits for projects featuring diverse casts and crews, has been clarified and expanded.
Reality television productions now have a clearer path to qualify for incentives, requiring at least 60% of filming in New Jersey and a six-episode order on a national network or streaming service. The program has also expanded its focus on digital media, including animation, VFX, and augmented reality. There's a separate application process and increased funding for this sector.
Finally, the state has provided substantial additional funding for studio and film lease partners, and lowered the budget threshold to qualify for specific benefits.
To learn more about New Jersey’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Ohio offers a film incentive program providing a 30% tax credit for qualified productions. While the program has experienced high demand, resulting in full allocation of funds, efforts to increase the program's budget are ongoing.
Unlike some states with a first-come, first-served approach, Ohio employs a case-by-case application process. This system allows for a more comprehensive evaluation of projects but can also create competition for limited funds.
Despite the current funding constraints, Ohio remains an attractive filming location due to its diverse landscapes and competitive tax credit. The state's commitment to growing its film industry is evident in its ongoing efforts to expand program funding.
To learn more about Ohio’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Pennsylvania maintains a robust film incentive program, offering a tax credit of up to 30% for qualified productions. Despite recent efforts to secure additional funding, the program's annual cap remains at $100 million.
While the state has not undergone significant program changes, the establishment of a new local Film Office is a positive development. This could potentially lead to the creation of additional incentives or support services, similar to programs in other states. Industry stakeholders may want to monitor developments closely.
To learn more about Pennsylvania’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Texas offers a grant-based film incentive program that can provide a significant financial boost to qualifying productions. While the program can offer a grant of up to 22.5% of eligible Texas expenditures, funding is limited and often exhausted due to high demand.
To maximize the potential benefits of the program, productions must prioritize hiring Texas residents, as the state requires a specific percentage of the crew to be local. Additionally, understanding the tiered grant structure, which is based on in-state spending, is crucial for optimizing the incentive.
While Texas has experienced a surge in production activity due to a recent influx of funding, it's essential to plan ahead and secure necessary permits and crew early to increase the chances of qualifying for the program.
To learn more about Texas’s production incentives, head over to our Production Incentive Center for a comprehensive breakdown of this state’s program.
Understanding the intricacies of state film incentives is crucial for maximizing production budgets. By staying informed of their latest updates and requirements, filmmakers can make informed decisions about where to shoot their next project.
While some states offer a generous tax credit, others rely on grant programs with limited funding. Regardless of the specific program, careful planning and strategic partnerships are essential for navigating this complex landscape.
Learn more about the most recent and significant state production incentive updates by watching our Incentives Summer Roundup with Ryan Broussard. And for a comprehensive state-by-state breakdown of all film incentive programs, head over to our Production Incentive Center.
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.
Daniela Bailes is a working film and television writer whose work travels across genres. A proud alumnus of the Yale Writer’s Conference in New Haven, she was mentored by literary luminaries before being selected for the National Hispanic Media Coalition TV Writer’s Program, a feature writer on the Latinx Black List, and as a participant in the Sundance Episodic Lab. Her most recent work was staffing on the upcoming Paramount science-fiction series, The Shift, also selling a feature script to A+E Networks.
