CAST & CREW ENTERTAINMENT SERVICES

TUESDAY, FEBRUARY 23, 2016

In this Issue

PROPOSED LEGISLATION

New Jersey
(A 2562 & S 1053)

New Mexico (S 238)

New York (S 4554)

Utah (H 310)

IN THE NEWS

Berlin, Portugal, Georgia, Ukraine, Switzerland

QUICK LINKS

Archived TIP Newsletters

PROPOSED LEGISLATION

Still in the House or Senate

Hawaii (H 2297)

House Bill 2297 proposes to amend the film incentive program by eliminating the sunset date.

Kentucky (H 342)

House Bill 342 proposes to change the film production tax incentive from a refundable tax credit to a nonrefundable, nontransferable tax credit.

Mississippi (H 444)

House Bill 444 proposes to amend the film production tax incentive program by extending the sunset date of the rebate on nonresident labor to June 30, 2020.

New Jersey (A 2256)

Assembly Bill 2256 proposes to reestablish the film production incentive program. Highlights of the proposed program are as follows:

Creates a funding cap equal to $30 million per fiscal year (July 1 - June 30);

At least one-third of the annual funding shall be issued for projects based in counties with insufficient economic activity indicators;

Creates a refundable tax credit equal to 25% of below-the-line expenses;

Credit is allowable against the taxpayers liability for the second privilege period beginning after the qualified project commences;

Requires qualified projects to have an annual or seasonal budget of at least $1 million;
Requires at least fifty percent of qualified costs to be studio based;
Defines qualified projects as a nationally distributed film or nationally televised program that operates from primary and fixed sets in New Jersey; and,
Allows the director to establish the order of priority of the application of the credit.

New Jersey (A 2562 & S 1053)

Assembly Bill 2562 and Senate Bill 1053 propose to reestablish the film production tax incentive program. The highlights are as follows:

Creates a transferable tax credit equal to 20% of qualified production expenditures;
Allows for a credit equal to 22% of qualified production expenses purchased from businesses located in or for services performed by residents of an enterprise zone;
Allows for a credit equal to 40% of qualified production expenses incurred in an eligible municipality during production or post production;

An eligible municipality is defined as a municipality in the state that has experienced the closure of at least two casino hotel facilities that had been licensed and operated within the boundaries of the municipality;

Creates an annual funding cap of $50 million per fiscal year (July 1 - June 30) for the film production tax credit and $10 million per fiscal year for the digital media production tax credit;
Requires withholding of 6.37% on payments to loan outs and independent contractors;
Requires applicants to enter into a partnership with a four-year public institution of higher education to provide industry employment opportunities for students enrolled in media and fine arts programs;
Requires applicants to demonstrate a net positive benefit to the state at the time of application;
Creates a minimum requirement of 60% of total production expenses to be incurred in the state;
Includes in the definition for "film" a feature film, television series, or a television show of 22 minutes or more that is intended for a national or regional audience including, but not limited, to a game show, award show, or other gala event filmed and produced at a nonprofit arts and cultural venue receiving state funding;
Requires principal photography to commence the earlier of 180 days from the date of the original application or 150 days from the date of the application's approval;
Requires screen credit to be provided;
Requires a CPA audit; and,
Creates a sunset date of June 30, 2022.

New Mexico (S 238)

Senate Bill 238 proposes to amend the film production incentive program by creating a 25% tax credit for distribution costs. The highlights of this bill are as follows:

Requires the company receiving the credit to have a physical address in New Mexico from which the company conducts business;
Limits the credit to the combined amount of credit the company is allowed in the same taxable year for production and post production expenditures for qualifying films shot in New Mexico;
Provides that the number of out-of-state films for which a company receives a credit shall not exceed the number of qualified films shot in New Mexico in the taxable year;
Defines distribution costs as payments of wages and fringe benefits made to New Mexico residents whose primary job responsibilities are to perform services within the film company's designated distribution in-house division or department; and,
Establishes the credit to take effect for film production companies that commence principal photography on or after July 1, 2016.

New York (S 4554)

Senate Bill 4554 proposes to amend the film incentive program to include a documentary film as a qualifying project.

Utah (H 310)

House Bill 310 proposes to amend the film incentive program by changing the programs' internal review from every five years to every three years beginning November 30, 2017.

IN THE NEWS

Berlin: Portugal, Georgia, Ukraine, Switzerland Promote New Production Incentives (February 19, 2016)

Concern as B.C. considers capping film and TV tax credit (February 18, 2016)

Gov. Deal reaffirms dedication to keeping state film tax credits (February 22, 2016)