In 2008, Georgia implemented one of the country's most aggressive film tax incentive programs. By all measure, the industry has exploded. In 2015 alone, feature films and television productions shot in Georgia generated an economic impact of $6 billion according to the Georgia Film, Music, and Digital Entertainment Office.
Some of the recent high-profile productions shot in Georgia include:
- Anchorman 2: The Legend Continues
- Captain America: Civil War
- Dirty Grandpa
- Hunger Games 2: Catching Fire
- Magic Mike XXL
- Trouble with the Curve
- The Walking Dead
The Georgia Entertainment Industry Investment Act offers a tax credit of up to 30% to a qualified film, television and music production. The credit is divided into two sections. The first 20% is a base transferable tax credit, with an additional 10% uplift known as the Georgia Entertainment Promotion (GEP) that can be earned by including an embedded Georgia logo to approved projects and a link to the Georgia film and music online site to the project’s associated promotional website.
Here's what you need to know about qualifying for the credits.
The Base Transferable Tax Credit (20%)
The 20% flat tax rate credit is offered across the board to any production in Georgia with a minimum investment of $500,000.00 over a single tax year.
The minimum annual expenditure threshold can be met on a single project or several aggregated projects in a single tax year. This means that televised commercials and music video productions are eligible if qualified expenditures by a single production company reach the designated threshold within the fiscal year, no matter if they were associated with one or more projects.
Eligible productions include:
- Feature films
- Television pilots or series
- Television movies
- Animated movies and television programs
- TV commercials
- Music videos
- Interactive entertainment projects, including video game development
- Sound recordings used in a qualified production that are produced in Georgia (excluding license fees)
The following projects do NOT qualify for the tax credit:
- Live coverage of sporting or news events
- Corporate marketing, industrial or training videos
- Commercials designed only for the web
- Infotainment programming
- Solicitation-based productions
- Feature films or TV programs consisting primarily of stock footage not originally filmed in Georgia
- Website development
- Productions not intended for more market distribution
- Pornographic content, sexually explicit content or content designated with an X rating
Qualified expenditures include the cost of materials, services and labor (with a salary cap of $500,000.00 per person, per production for salaried employees). Only production expenditures actually spent in Georgia qualify, although insurance and travel costs can qualify if they were purchased through a Georgia-based agency or company.
Post-production expenses, excluding marketing and distribution, are also qualified expenditures. It's important to note, however, that postproduction on footage shot outside of Georgia does not qualify.
The Georgia Entertainment Promotion (GEP) Uplift (10%)
An additional 10% credit is available for approved projects that include an embedded Georgia logo within the end credits before the below-the-line crew credit roll in the finished product, as well as a link to www.tourgeorgiafilm.com on the project's promotional website. Feature films, television series, pilots and movies, as well as music videos may be eligible to receive the uplift. Commercials, however, do not qualify to receive the additional 10% GEP credit.
The Application Process
Application for the tax credit must be submitted to the Georgia Department of Economic Development within 90 days of principal photography to be certified. In most cases, review and certification are completed within 72 hours unless additional information is required.
Separate applications must be submitted for the 20% base tax credit and the 10% GDP uplift. The GEP uplift will be allowed for projects which the Georgia Department of Economic Development deems will create a valuable promotional opportunity and enhance Georgia's brand.
GEP applications for feature films, television pilots, and television series must include the completed project certification application form, the completed Georgia Entertainment Promotion application form, and a copy of the final shooting script. In the case of music videos, a copy of the finished project must be submitted to the Georgia Film, Music and Digital Entertainment office along with the completed GEP application form.
Additional information can be found at: http://www.georgia.org/fmde.
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