Save up to 30% in GA
The 2008 Georgia Entertainment Industry Investment Act (The Act) upgraded the original 2005 version and provides for a 30% gross tax credit on qualified Georgia production expenditures.
20% Base Credit
The foundation of The Act is the 20% transferable base tax credit for all qualified Film, Television, Commercials, Music Videos, Interactive Games and Digital Entertainment.
10% Credit Uplift
Currently, The Act provides for an additional 10% transferrable tax credit uplift (for a total 30% gross transferrable tax credit) if a production company includes the approved Georgia promotional logo (shown above) in the credits of the qualified finished feature film, TV series, documentary or interactive game project. Commercials and music videos are not eligible for this uplift.
Beginning January 1, 2013, The Act provides for an additional 10% transferrable tax credit uplift (for a total 30% gross transferrable tax credit) if a production company includes the approved Georgia promotional logo (shown above) in the end credits of the qualified finished feature film, TV series, documentary or interactive entertainment production before below-the-line credits, and which includes a specified link to Georgia on the project’s web page. Production’s that desire the uplift, but cannot place the Georgia logo before below-the-line credits, may substitute alternate marketing opportunities of equal or greater value, as determined in negotiation with the GA Film Office. Commercials and music videos are not eligible for this uplift.
$500K Minimum Qualified GA Spend
Production companies that spend a minimum of $500,000 in the State of Georgia on single or aggregated productions over a calendar or fiscal year on qualified preproduction, production and post-production expenditures are eligible for this credit. This includes most materials, labor and services.
Materials and equipment purchased or rented by non-Georgia pass through entities will not be considered as qualified Georgia expenditures.
No Residency Requirements
The Georgia tax credit applies to both residential and out-of-town labor working in Georgia.
$500K Salary Cap on W2 Hires
There is a salary cap of $500K per person, per production, when the employee is paid by “salary,” which is defined as being paid by W2. This includes standard fringes.
No Cap on 1099 Hires
If a production company uses a 1099 or personal services contract (a loan-out company) to hire an individual there are no limits. This also includes standard fringes.
Beginning January 1, 2013, productions are required to withhold 6% from all loan-out companies. These fees may or may not be recoverable, depending on the Georgia State Tax obligation of the company. No tax refund from the state is allowed until the loan-out company is registered in Georgia.
Sales & Use Tax Exemption
The Georgia Sales and Use Tax Exemption for qualified production expenses was discontinued on June 1, 2012.
No Limits on GA Spend
Currently, there is no cap on a qualified Georgia production spend.
Beginning January 1, 2013, the aggregate amount of tax credits allowed for qualified interactive entertainment production companies and affiliates is $25M. The maximum credit for any single interactive entertainment company and its affiliates is $5M. These credits shall be distributed on a first come, first serve basis. Film, television, documentaries, commercials and music videos DO NOT have a cap on their Georgia spend.
No Sunset Clause
The Georgia Legislature has not created a sunset provision for any portion of The Act.
Transferrable Tax Credits
The tax credits apply to the originating production company’s Georgia income tax liability or it’s withholding liability. Should the company have limited or no Georgia income tax liability, then the credit may be sold and transferred once to one or multiple Georgia-based taxpayers to use against their state income tax liabilities. Withholding is NOT currently transferrable to third party buyers.
Earned Georgia Entertainment Tax Credits can carry forward up to five years from the year of production certification and verification, but may not be applied retroactively to year’s prior.
Infrastructure Investment Tax Credits
Currently, Georgia does NOT offer tax credits for entertainment infrastructure investment.
THE ACT LINK
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