Program aimed at job intensive productions
California’s new incentive program for film and television entertainment purposefully focuses primarily on feature films and higher-budget productions for the tube, which tend to be job intensive.
The break comes in the form of a 20% credit against taxes for crew wages and spending on equipment and for services directly related to production costs in California. Salaries for actors, directors, writers, producers and composers — the above-the-line part of a film’s budget — don’t qualify. At least 75% of production days or three-quarters of a project’s budget must be California-based.
The 20% credit applies to theatrical features budgeted at between $1 million and $75 million. Also qualifying for the credit: direct-to-DVD productions; telepics or miniseries with a $500,000 production minimum; and new television series at least a half-hour long licensed for basic cable and budgeted at $1 million or more.
Additionally, $10 million is set aside each fiscal year and is targeted specifically at independent feature films.
Productions that don’t qualify include reality shows, half-hour episodic television series, talkshows, sporting events, gameshows, award fests, public affairs programs, commercials and musicvideos. Costs incurred before an application is approved also get nixed.
Applications have to be turned in at least 30 days before principal photography starts. And once approval is granted, shooting has to begin within 180 days.
There’s a higher 25% break available for a television series that filmed all its prior seasons outside California. The extra dollop, sometimes referred to as the “Ugly Betty” provision, is a form of reverse payback for the move by the hit ABC series from Los Angeles to New York, attracted by the Empire State’s tax incentives — which still have one-third of the $350 million left.