If you guessed New Jersey, you’re right. The state boasted a 75% increase in productions year-over-year. And that’s not a fluke.

A generous, recently extended incentive, world-class studio infrastructure, and proximity to one of the world’s greatest cities make the Garden State one of the most compelling production destinations in the country.

Here’s what you need to know.

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The Incentive at a Glance

New Jersey’s Film and Digital Media Tax Credit Program offers a generous transferable credit. The headline numbers:

• 35% credit on qualified wage and salary payments statewide

• 30% credit on qualified expenses incurred for goods and services (non-payroll) at locations within a 30-mile radius of the corner of Eighth Avenue and West 59th Street in Manhattan (that’s Columbus Circle in NYC, and yes, they really did define it that precisely)

• 35% credit on qualified expenses incurred for goods and services (non-payroll) outside the 30-mile radius of Columbus Circle, NYC, to incentivize productions to venture beyond the NYC metro corridor

• Up to 40% for Designated Studio Partners and Film-Lease Facility Partners (more on them below)

• 35-40% for post-production: 35% for qualifying independent post-production companies, rising to 40% for work performed at a New Jersey film-lease production facility or through a Studio Partner

The credit is transferable, meaning productions that can’t use it can sell it — a significant advantage. And a bonus for Studio Partners (and only Studio Partners): as of January 1, 2026, the state will also purchase unused credits at 95 cents on the dollar (subject to annual caps: $80M in FY2026, scaling to $200M annually from FY2029 onward), offering productions a guaranteed floor on the credit’s value.

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Show Me the Money: Program Funding

The program is well-funded, with a total of $430 million in annual allocations across three buckets:

• $150 million reserved for New Jersey Studio Partners

• $150 million reserved for New Jersey Film-Lease Production Companies

• $100 million for all other taxpayers

• $30 million for Digital Media (including post production)

Credits are awarded on a first-come, first-served basis, so timing your application matters.

And here’s the big headline from late 2025: in November, Governor Murphy signed legislation extending the program’s eligibility period by ten years — from 2039 all the way to July 1, 2049. That’s 23+ more years of certainty for productions and studios making long-term commitments to the state. In the incentives world, that kind of longevity is extraordinarily rare — and extremely valuable.

Who Qualifies?

New Jersey’s incentive covers film and digital media productions — primarily scripted content. To qualify, productions generally must meet one of two thresholds:

• At least 60% of total film production expenses (excluding post-production) are incurred through vendors authorized to do business in New Jersey

  -OR-

• Qualified film production expenses exceed $1 million per production

Productions must include a “Filmed in New Jersey” statement or logo in the end credits and commence principal photography within 180 days of application. Additionally, productions must withhold 6.37% from all payments to independent contractors and loan-out companies providing services used directly in the production, so be sure to build that into your budget from the start.

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Reality TV? Special Rules Apply

Unscripted producers, listen up — because the details here are tricky.

Reality shows are generally ineligible for NJ’s Film Tax Credit Program.

However, they can qualify if they meet one of these conditions:

• At least 60% of total film production expenses (excluding post-production costs) are incurred through New Jersey vendors

  -OR-

• Qualified expenses exceed $1 million per production

There’s also one more hoop to jump through: the production must come with a firm order of at least four episodes from a major linear network or streaming platform, already greenlit and set to air. Spec shoots and independent passion projects need not apply.

The bottom line for unscripted producers: it’s possible, but the bar is higher. Budget accordingly.

The Studio Partner Advantage

One of New Jersey’s most powerful differentiators is its Studio Partner designation — available to production companies that have site control of a production facility with a minimum 250,000 square feet of space under a term of at least ten years. Designated Studio Partners and Film-Lease Facility Partners enjoy:

• An enhanced base credit of up to 40%

• An additional 4% credit on qualified expenses incurred on or after July 1, 2025 (a recent legislative sweetener that takes an already generous rate even higher)

That enhanced rate has already proven transformative. Netflix Co-CEO Ted Sarandos told a U.S. Senate subcommittee that since New Jersey’s incentive passed, Netflix has redirected eleven productions back to the Garden State — including seven that had been heading to the UK.

The Netflix Factor: Fort Monmouth

Speaking of Netflix: the streamer isn’t just shooting in New Jersey. It’s building there.

Netflix Studios Fort Monmouth is a $1 billion, 290+-acre production campus rising from the grounds of a former U.S. Army base in Oceanport and Eatontown. When completed (projected 2028), it will feature twelve state-of-the-art soundstages totaling nearly 500,000 square feet — making it Netflix’s second-largest production facility in the world, behind only its ABQ Studios in New Mexico.

The economic ripple effects are staggering. The project is expected to create up to 3,500 construction jobs during the build phase and 1,400 permanent positions once operational. Over the next 20 years, it’s projected to generate an estimated $3.8 to $4.6 billion in economic activity in New Jersey — a stunning return on the state’s incentive investment.

It’s also proof that when you build the infrastructure and back it with a stable, long-term incentive, the industry follows.

Netflix was already rolling cameras in the Garden State before the studio even opens. Productions recently underway include Here Comes the Flood, starring Denzel Washington and Robert Pattinson, with over 500 workers on and off-screen.

What Changed in 2025 (and What Didn’t)

A couple of notable updates for productions applying under the revised program:

• The Diversity Incentive is now the Crew Hire Incentive, offering a 4% uplift if 25% of the production’s crew, talent, and extras hired are from a list of ~200 economically disadvantaged communities.

• The 95% buyback is new and significant. For original applications approved by NJEDA on or after January 1, 2026, the state Director is now required to purchase any unused tax credits at 95% of face value, subject to annual caps. For productions planning to sell their credit rather than use it, this provides meaningful price certainty that many other jurisdictions simply don’t offer.

• The extension to 2049 is a game-changer for long-term planning. Productions and studios can now build multi-year strategies around New Jersey with confidence that the program will be there to support them.

Don’t Overlook: Sales Tax Savings

Productions can also capture an additional 6.625% savings on New Jersey sales tax. Certain tangible property purchased and used directly in the production of film and television is exempt from NJ sales tax. Plus: long-term hotel stays exceeding 90 days may also be sales-tax-exempt — a meaningful savings on lengthy location shoots.

The Fine Print: Budget for These Costs

As we’ve covered in our Hidden Costs of Production Incentives post, New Jersey’s incentive comes with a range of administrative fees that can shave $1,300 to $65,000 off your incentive, depending on qualifying spend. These include an application fee, an approval fee, an issuance fee, and a credit transfer fee. Build them into your budget upfront to avoid a surprise after you’ve already committed to the location.

The application process also requires that you consult with an NJEDA Program Analyst before submitting. Contact them at (844) 965-1125 or CustomerCare@njeda.gov, or apply directly at programs.njeda.com.

The Bottom Line

New Jersey has stopped trying to be a cheaper alternative to New York and started building an identity all its own. With a generous, transferable credit of up to 40%, a billion-dollar studio rising from the Jersey Shore, a program now locked in until 2049, and a new state guarantee to buy back credits at 95 cents on the dollar, the Garden State is making a compelling case to producers thinking beyond Burbank or beyond the border.

The 75% production surge in 2025 wasn’t an accident. It was the result of years of smart policy combined with a greater awareness from studios, networks, and filmmakers of the State's large, experienced workforce and wide variety of “lookalike locations” in a geographically compact area; a great incentive; a film commission proactively engaged in streamlining statewide permitting; and a mature but rapidly expanding infrastructure of stages, wardrobe, lumber mills, equipment rental facilities, and more. And the momentum is only building.

For full program details, visit www.njeda.gov/film or the NJ Motion Picture & Television Commission.

Filming in New Jersey?

Don’t Leave Money on the Table.

New Jersey’s incentive is generous — but it’s also complex.

Between the 60% vendor spend threshold (when qualified spend < $1M), the withholding requirements, the tiered fee structure, and the specific rules for digital media and post, there are plenty of opportunities to either maximize what you receive - or accidentally leave qualifying expenses on the floor.

Incentiviiz is an AI-powered incentives management platform built to simplify the complicated incentives application process and maximize your return.

And they know New Jersey…because they’re based there!

Simply link Incentiviiz to your existing cloud-based file management system (Dropbox, Google Drive, and more), and it gets to work, automatically identifying and extracting qualifying expenses, tracking your progress toward minimum spend thresholds, flagging missing receipts or vendor details, and keeping you on top of application milestones and deadlines.

The platform was built by Shawn Hamilton, a former production accountant with stints at Amazon, Viacom, and more alongside the team behind the cloud-based production management system Conduiit — which is already used on productions for Netflix, HBO, Apple+, and Facebook Watch. They know this world.

Some users have reported boosting their incentives payout by 6-10% by using Incentiviiz to uncover qualifying expenses they otherwise would have missed. At that rate, it more than pays for itself. And speaking of paying for it: there’s no upfront cost. Incentiviiz retains a small single-digit percentage of the incentive collected — meaning it’s zero risk, all reward.

Productions can even borrow against their anticipated incentive at preferred rates through the platform’s banking partner, with funds dispersed as needed — a significant cash flow advantage when you’re in production.

Want to give Incentiviiz a try on your next New Jersey production? Drop founder Shawn Hamilton a line at shawn@conduiit.com — and tell him Carrie sent you.

Film commissions: Brag about your own incentive in our next Jurisdiction Spotlight.

Just reach out at carrie@carrieregan.com, or via our website.

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What we know:

The tax credit offers big benefits to the Mexican production community, requiring that at least 70% of suppliers be local for productions to qualify.

A complication: the credit’s project payout cap of $2.3M US (40M pesos) is relatively low for features compared to various other jurisictions, while the $1.1M (20M peso) minimum spend may be high for certain categories of unscripted and docs, which could limit the incentive’s appeal.

But for projects with budgets in that sweet spot, whose editorial calls for one or more of Mexico’s diverse locations (think Caribbean beaches, colonial architecture, bustling cities, ancient ruins, stunning landscapes) - it’s enticing. Layer on Mexican state incentives like Jalisco’s 40% cash rebate and the right production could save a nice chunk of change.

More details:

• Qualifying formats: Live action, animated features, series (including qualifying unscripted), docs, VFX, post

• Form: 30% income tax credit

• Requirements:

  • Project must use a of minimum 70% local suppliers

  • Minimum local spend:

    • Live action & animated features and series episodes: $2.3M (40M peso)

    • Documentary features and series: $1.1M (20M pesos)

    • Select animation, VFX, and post: $291K (5M pesos)

• Project Cap: $2.3M US (40M pesos)

Who’s eligible: Mexican individuals/entities, foreign individuals/entities with permanent establishment in Mexico, and foreign individuals working through a Mexican individual (eg service provider) or legal entity

The new incentive is a boon to the local film industy.

But when it comes to location-agnostic foreign productions, can it compete with incentives elsewhere…

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…especially as beefier US incentives are luring runaway productions back?

Witness New Jersey, which saw the biggest % growth in film production in the US in 2025, with a 75% increase in productions YOY. New Jersey’s incentive - with its hefty 30-35% base credit, plus diversity and opportunity zone uplifts and select sales tax exemptions, are helping drive that growth (we’ll have more on NJ’s incentive in our upcoming Jurisdiction Spotlight).

The Garden State’s studio partnerships, infrastracture tax credits, and the extension of its incentive until 2049 all offer a stable foundation for industry growth. Designated studio partners enjoy an enhanced 40% base tax credit, which has already inspired Netflix to reroute eleven projects previously slated to film abroad to New Jersey. The state’s Aspire Program incentivized Netflix to transform a former army base into a billion-dollar, 292-acre, state-of-the-art New Jersey production facility, Netflix Studios Fort Monmouth, creating thousands of jobs and generating an estimated $3.8-4.6B in economic activity in the state in the coming two decades.

It’s just the kind of long-term commitment and investment that might keep more US productions from moving abroad - even as jurisdictions like Mexico sweeten the pot.

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Producing across borders?

Hosting foreign crews?

Be prepared.

International productions and co-productions deliver significant financial benefits, but cultural misunderstandings can quickly erode those savings through miscommunication, project delays, and team friction.

Globally Minded helps production companies, crews, film commissions, and service providers turn cultural differences into strategic advantages. With 25+ years of leading multicultural teams across five continents and delivering millions in cost savings through international partnerships, we provide:

• For Production Companies & Crews: Cultural intelligence training, location culture research, and team playbooks that prevent costly miscommunications, accelerate team cohesion, and maximize the ROI of your international shoots and partnerships

• For Film Commissions & Service Providers: Tools to better serve foreign clients, differentiate your location, and build lasting production relationships that bring crews back

Whether you’re shooting abroad, collaborating with international partners, or hosting foreign productions, cultural agility isn’t just nice to have - it’s a competitive edge.

Learn more at Globally Minded, or reach out to Carrie directly at carrie@carrieregan.com to find out more.

Film commissions: Time to brag about your own incentive! We’re featuring Jurisdiction Spotlights in upcoming issues of Production Incentives Insider.

Just reach out to us at the email above, or via our website.

Subscribe now

Some major US jurisdictions raced to lure runaway productions back home, while global locations sweetened the pot in areas like unscripted, post, VFX…and even toyed with incentivizing generative AI.

We’ll dive into the big changes that defined 2025, but first: if you film across borders - or provide services for international crews - be sure to read to the end for a sneak peek at a service that could save you lots of time, money, and trouble.

Now on to those incentives!

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California Doubles Down with $750M Program

California made the biggest splash of 2025, more than doubling its annual film and television tax credit program from $330 million to $750 million, which became effective July 1, 2025. Under Program 4.0, the Golden State now offers a 35% refundable tax credit, with a 5-10% uplift for projects outside the Los Angeles zone and 40% for relocating TV series.

California’s Program 4.0 also expanded eligibility criteria beyond bigger-budget scripted productions. For the first time, animated films and series (minimum $1 million budget/ep), TV series with episodes averaging 20 minutes or more (eg, sitcoms at last!), and large-scale competition shows are eligible. Traditional reality TV and other unscripted formats remain ineligible, however (womp womp).

The first application window (July 7-9, 2025) saw television series applications jump 400% compared to the previous program. By October 2025, 48 projects had been approved that are collectively expected to generate over $660M in economic activity.

New York Raises the Stakes to $800M

Not to be outdone, New York Governor Kathy Hochul signed a budget in May 2025 that increased the state’s annual film and TV subsidy cap to $800 million - the highest in the program’s history. The 30% refundable tax credit features a number of bonuses that can boost it even higher.

The revised program includes a dedicated $100M pool specifically for lower-budget indies and introduces an additional 5-10% “Production Plus” bonus credit for companies that commit to multiple productions in the state.

Big-budget producers committing to at least 2 projects totaling $100M or more in qualified spend now receive an additional 10% bonus, potentially bringing the total credit to 40%; indies spending $20M+ will score a 5% bonus on subsequent productions. The program also added a 10% bonus for film scoring costs when productions employ at least five in-state musicians.

The biggest news: New York also removed the previous $500,000 cap on above-the-line costs (note: they cannot exceed 40% of total qualified spend). And more exciting still: New York is also doing away with its much-loathed, multi-year incentive payout structure, streamlining the process so that productions can now claim credits in full in the allocation tax year.

New York’s incentive applies to both scripted and unscripted content, including reality television, though specific project types are evaluated on a case-by-case basis.

UK Enhances VFX / AI Incentives

This year, the United Kingdom boosted its Audio-Visual Expenditure Credit (AVEC) to 39% (29.25% net post corporate tax) for qualifying visual effects expenses, a 5% increase from the previous rate - and certain generative AI costs also qualify (eg using AI to create backgrounds, crowds, and digital characters).

Another big bonus: VFX costs are now exempt from the 80% cap on qualifying expenditure that applies to other production costs.

This means productions can receive net 25.5% relief on filming and other non-VFX costs (up to 80% of total budget) and still claim net 29.25% on VFX spend even if it takes total UK spend above the 80% threshold. The UK government estimates this will attract an additional £175M/ year in VFX spending and create 2,800 new jobs.

Additionally, the UK launched a 53% Independent Film Tax Credit (IFTC) (net 39.75% after taxes - still much higher than the standard net 25.5% rate) for films with budgets under £23.5M. However, it cannot be combined with the VFX uplift.

UK incentives apply to scripted content, including film, high-end TV, and animation, and remember - a cultural test applies.

British Columbia Jumps to 36%

This year, British Columbia also increased its production services tax credit (PSTC) from 28% to 36% for international productions with principal photography - a dramatic 8-percentage-point jump designed to reclaim its “Hollywood North” status. The Film Incentive BC (FIBC) for Canadian-content productions rose from 35% to 36%.

And remember: British Columbia’s incentives apply to both scripted and unscripted content, including reality television, documentaries, and animation.

Foreign productions represent over 80% of total production spending in BC on average, making the PSTC increase particularly significant.

Productions with BC costs exceeding $200M receive an additional 2% bonus, bringing potential totals to 38%. The province also reinstated regional and distant location tax credits for qualifying animation productions with physical offices outside Metro Vancouver, the Fraser Valley, and Whistler/Squamish.

Ireland Introduces 40% “Scéal Uplift” and Launches Unscripted Incentive

Ireland made major moves in 2025 with two significant incentive announcements. In May 2025, the government officially launched the “Scéal Uplift” (announced in the October 2024 budget), increasing the Section 481 tax credit from 32% to 40%—an 8% boost—for feature films and animated features with qualifying expenditure under €20M. This enhancement specifically targets Irish-led productions featuring Irish creative talent in key roles.

The uplift aims to support smaller-scale Irish cinema and close the gap with the UK’s new 40% Independent Film Tax Credit. Ireland’s recent international success—with films like Kneecap winning at Sundance and Small Things Like These opening Berlin—underscored the importance of supporting homegrown productions.

Even more significantly for the unscripted community, the EU approved Ireland’s 20% tax credit for unscripted production. This unscripted television production incentive applies to qualifying production spend up to €15M per project; at least half the minimum required €250K budget per production must be spent in Ireland.

Productions must pass a cultural test administered by the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media. The credit is designed to help Ireland become an international hub for unscripted television, including game shows and entertainment formats seeking a cost-effective European hub, positioning the country to compete with similar incentives in Malta and Cyprus. In recent years, several Fox Entertainment game shows aimed at the US market have migrated to Dublin and Wicklow.

Additionally, Ireland boosted its VFX credit: up to €10M of eligible Irish expenditure on VFX work can now qualify for the uplifted 40% rate (from 32%) for projects deemed “visual effects projects.” Projects must spend at least €1M on qualifying VFX services.

Ireland’s existing 32% Section 481 credit applies to scripted content only (feature films, TV drama, animation, creative documentaries). The new 20% unscripted credit specifically covers game shows, reality television, and other unscripted formats that pass the cultural test, marking Ireland’s first formal incentive for unscripted content.

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OTHER SIGNIFICANT CHANGES IN 2025:

• Texas – Passed SB22, providing $150 million annually (through 2035 - $1.5B total!) for film, TV, and digital media productions. The rebate offers up to 25% base rate with potential uplifts to 31%. Minimum spend: $250K for features/TV, $100K for commercials. Includes escalating local hire requirements (35% Texas residents initially, rising to 50% by 2031). Applies to scripted and unscripted.

• Wisconsin – Film incentives return in 2026 after 12-year hiatus! New program provides 30% transferable tax credit on qualified in-state spend and resident labor, capped at $1M/project with a $5 million annual program cap.

• Iowa – A pilot program launching in 2026 will offer up to 30% rebate on qualified spend, with an annual program cap of $4 million. The program is still in administrative rule development; preliminary details suggest production facilities must be principally located in Iowa for at least 3 years to apply, with a minimum $1M film budget. Follow developments here.

PROGRAM ENHANCEMENTS:

• Georgia – Reinstated post-production tax credit starting January 1, 2026, at 20% for companies spending at least $500K on qualified expenditures. Additional 10% bonus if project shot in Georgia, 5% bonus for rural county post work. Annual post credit program cap: $10M.

• New Mexico – Increased annual funding cap to $130 million for FY2025, stepping up to $140M for FY2026, solidifying status as competitive alternative to larger markets. Applies to scripted and unscripted content. Details here.

MUNICIPAL INCENTIVES:

• Greater Fort Lauderdale, FL – Launched new Scripted Series Program offering 25% rebate - the largest rebate percentage in Florida. Projects must spend a minimum of $12 million in Broward County; rebate cap of $5M/project (or season).

• Savannah, GA – Increased local cash rebate cap from $100K to $175K for features and $250K to $300K for TV. Can be stacked with Georgia’s 30% transferable tax credit.

• Broken Arrow, OK – Approved $100,000 pilot film incentive program, making it Oklahoma’s second-largest municipal film incentive after Oklahoma City. Offers 10% rebate on local spend, 10-20% rebate on production space costs, and more.

The Bottom Line

The 2025 incentive wars reflect an industry in flux. California and New York are finally competing seriously with international markets and uncapped programs like Georgia’s. As the UK and Canada leverage their advantages in VFX capabilities and crew depth, Ireland positions itself to be a leading European unscripted hub.

In short, incentives continue to be a prime lever in drawing productions and driving industry and economic development - with no signs of slowing down in 2026.

Working across borders? Cultural Intelligence pays.

International productions and co-productions deliver significant financial benefits, but cultural misunderstandings can quickly erode those savings through miscommunication, project delays, and team friction.

Globally Minded helps production companies, crews, film commissions, and service providers turn cultural differences into strategic advantages. With 25+ years of leading multicultural teams across five continents and delivering millions in cost savings through international partnerships, we provide:

• For Production Companies & Crews: Cultural intelligence training, location culture research, and team playbooks that prevent costly miscommunications, accelerate team cohesion, and maximize the ROI of your international shoots and partnerships

• For Film Commissions & Service Providers: Tools to better serve foreign clients, differentiate your location, and build lasting production relationships that bring crews back

Whether you’re shooting abroad, collaborating with international partners, or hosting foreign productions, cultural fluency isn’t just nice to have - it’s a competitive edge.

Learn more at www.getgloballyminded.com, or reach out to Carrie directly at carrie@carrieregan.com to find out more.

Film commissions: Time to brag about your own incentive!

We’d love to feature you in Production Incentives Insider.

Just reach out to us at the email above, or via our website.

Subscribe now

Your production company has a project you’re passionate about. The network shows interest, but the budget’s too high.

But there’s hope: your shoot location offers a production incentive. You check the basic program rules and run a budget to estimate how much you’ll receive.

Good news! The incentive is enough to close the budget gap. The network is happy, and you secure a greenlight. Your production accountant applies for the incentive, receives preliminary approval, and you’re on your way.

Then, costs associated with the incentive begin to creep in, carving into that precious savings you promised the network.

Audit fees, extra bookkeeping costs, state admin fees…it all starts to add up, racking up thousands in unexpected costs.

Your production company could swallow the overage, carving into your already slim margin. Or maybe you’ll swallow your pride and ask the network to cover the unexpected costs - never a pleasant conversation, and one that risks damaging reputations and relationships.

Sure, you might still receive a decent incentive. But the gap between expectations and reality leaves everyone upset and bitter about the whole process.

This doesn’t have to happen!

Production companies can avoid falling prey to the “incentives bait and switch” by ensuring they’re aware of and accounting for all costs associated with the incentive upfront.

We’ve listed our top six surprise costs associated with incentives that get productions into trouble - and cap them off with tips and tools that may help decrease costs while increasing your incentive.

Our Top 6 Hidden Incentives Costs, aka “We’ve gotta pay what to get our incentive?!”

Fortunately, most of the costs associated with an incentive are pretty predictable. They include:

1. Application & jurisdiction administrative fees

These fees will be spelled out in the jurisdiction’s guidelines, but they’re not always front-and-center, so they can be easy to overlook if it’s your first time applying to their program.

Illinois has a generous incentive, offering a 30% transferable tax credit on all qualified spending, including post—but they assess a fee equal to ”2.5% of credit amount eligible for non-resident wages, and an additional 0.25% of the total amount of the credit which is not calculated on non-resident wages.” And get this: the fee must be paid before the tax credit certificate is issued.

New Jersey’s incentive is also robust, with a transferable credit of up to 35% on qualified spend, but you’ll face a variety of fees, including an application fee, approval fee, issuance fee, and credit transfer fee. In total, they can shave anywhere from $1,300 - $65,000 off your incentive depending on your qualifying spend, as detailed in this table:

Louisiana’s generous credit of up to 40% of qualifying spend requires an application fee of 0.5% of the estimated tax credit (starting at $500, not to exceed $15,000).

Some incentive programs, like Hawaii’s, require companies to contribute a percentage of their qualifying spend to workforce development programs (in Hawaii’s case, the higher of 0.1% of the qualifying production spend or $1000). Hawaii also charges an administrative fee equal to 0.2% of the total credit.

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2. Audit fees

Ah, the much-feared audit. Fees can range depending on the auditor, with some charging an hourly rate while others opt for a flat rate (we prefer the latter. Why? See this post about all things audit, featuring our friend David Brauer of Brauer & Co). Some jurisdictions use government auditors and typically have a set fee schedule for their services. Others may have a list of approved outside auditors.

Other jurisdictions, like Georgia, offer the choice of a state auditor or one from an approved list. The audit fee in Georgia varies depending on local production spend. If an “eligible auditor” is selected instead of one from the state, productions must still pay an administrative fee to “finalize” the audit:

Audit fees can also range dramatically depending on the thoroughness of the audit required by the jurisdiction. For instance, Texas and Illinois conduct thorough audits that require a review of all expense-related documentation. Hawaii, on the other hand, doesn’t require a CPA audit for credits under $1M (although they will conduct a quick internal audit, at no charge to the project). Don’t make the mistake of assuming the costs of an audit will be the same from one jurisdiction to another.

3. The “discount” on your transferable tax credit

We dug into the ins and outs of selling transferable tax credits with Chad Agena, Managing Director and Head of Tax Credit Brokerage at TPC, in this post. As Chad cautioned, don’t make the mistake of confusing your total transferable tax credit with your (lower) “net to production.”

In other words, if your company isn’t able to use the tax credit and plans to sell it, you won’t be able to recoup its entire value. Rather, when you sell it, you’ll do so at a discount - say, around 85-90% its total value, reaping less than its total value.

Jurisdictions might also charge a transfer fee. For instance, Louisiana offers to buy back such tax credits at 90 cents on the dollar and charges an additional 2% transfer fee. That $300K tax credit you’ve been counting on has suddenly dwindled to $264K…before factoring in other associated cost.

4. Business registration fees

Some jurisdictions require that out-of-state production companies form and register a local entity in order to receive the incentive. For instance, Louisiana requires that production companies be incorporated in Louisiana - a process that requires a state filing fee, registered agent service, annual filing fees, the paying of franchise taxes, and potential legal fees.

Some jurisdictions, like New Mexico or Hawaii, require that you file a tax return to receive their refundable credit, which may generate additional tax preparation costs.

Other jurisdictions may require additional registration and licensing fees, like Hawaii’s GET (general excise tax) license (granted, just $20).

Finally, when working in jurisdictions outside the US, production companies will often hire a local service provider to help with both production services and filing for the incentive. Such service providers sometimes require a percentage of the incentive as part of their compensation.

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5. Promotional assets

Some jurisdictions might require that the production deliver promotional assets—everything from set photos to full-on social media campaigns involving talent. For example, the St. Pete/Clearwater, FL film commission offers an uplift in exchange for “extra marketing value,” including a “robust social media plan.”

This one may be easy to overlook, but creating those assets takes time. I’ve also seen productions mistakenly assume that talent will be eager to participate in promoting a location for free…until their agent calls, looking to score a piece of the action for their client.

Many jurisdictions require a logo in the credits (who hasn’t seen the “Georgia peach”?). Doing so generally doesn’t add to the budget, but production companies should make sure the network or streamer has agreed to include it to avoid jeopardizing the incentive down the road.

6. Bookkeeping fees

Wrangling all the paperwork required to file for an incentive takes time. Ensure you’re aware of the specific reporting requirements for your jurisdiction and that you’re properly budgeting for the additional production management/accounting labor required to manage the process. This, too, may vary depending on the jurisdiction’s reporting requirements.

How can you avoid the incentives bait-and-switch trap?

Three words: Plan, plan, plan.

Production companies:

Do your research. Dig into all the jurisdiction’s rules to ensure you’re account for all relevant administrative fees. Realistically plan for extra bookkeeping and audit expenses, as well as that transferable tax credit discount.

Pay attention to any caps the jurisdiction might impose on line items like above-the-line labor, airfares, and hotel costs so you don’t overestimate the incentive you’ll receive.

Keep detailed records. The better your records, the smoother the audit, the less time required and hours billed. Where relevant, talk to your auditor and the broker of any transferable credit ahead of time. They can help you avoid common mistakes and provide more accurate estimates of costs for their services, as well as the discount you should plan on for your transferable credit.

When filming in a new location, don’t assume that you can simply carry over costs like audit fees, accounting costs, and administrative fees from one jurisdiction to another. As we’ve seen, costs can vary wildly from one to the other.

Networks/Studios/Streamers:

Dissect any claims a production company makes about the amount of incentive they’ll receive. Are they including administrative fees? Audit fees? Have they properly accounted for extra bookkeeping and accounting costs? Caps?

This more thorough analysis takes time, but it could save you tens of thousands in unexpected costs in the end. In some rare cases, you might even find that applying for the incentive is more trouble than it’s worth.

Film commissions:

Be as transparent as possible about any administrative fees associated with the incentive. An easy-to-read table like New Jersey’s (above) will make it easier for producers to determine if your incentive is right for them, before they dig into the finer details. It’ll probably save you lots of time otherwise spent answering lots of questions, too!

Tools to help avoid the unexpected

Tech to the rescue! New tools may help reduce the costs of managing your incentives and increase the amount you receive.

Our favorites include:

Production accounting and payroll company Greenslate offers a variety of tools to help you estimate, track, and monetize your incentive, including a dashboard that tracks your incentives application status across multiple projects. Greenslate takes on all post-production accounting responsibilities, including coordinating with state agencies, auditors, and brokers. They boast a 99.5% accuracy rate when comparing their incentive estimate against the actual amount clients have received, which helps prevent any nasty surprises.

Incentiviiz’s incentives management platform works with your in-house production accounting team, boasting tools to help research incentives, compare estimates across multiple jurisdictions, and find local service providers. It also works with your existing file management system to import, identify, track, and manage qualifying expenses. Some users have reported boosting their incentives payout by as much as 6-10% by using the platform to uncover qualifying expenses they otherwise might have missed. At that rate, it basically pays for itself.

Have you used Greenslate or Incentiviiz? Let us know your thoughts - and tell them you read about them in this newsletter.

Production Companies: Budgets have never been tighter, or greenlights harder to come by, making incentives more important than ever. Still, the process isn’t always easy.

Share your incentives, headaches, questions, and quandaries with us and we might just cover them - along with advice from the experts - in an upcoming newsletter.

Film commissions: Need help luring productions? Contact us to brag about your incentive in this newsletter!

Drop me a line at carrie@carrieregan.com.

I’m not going to mince words here: some networks and streamers are really screwing up when it comes to collecting production incentives for their fully commissioned, unscripted content.

It’s costing everyone: Production companies. The jurisdictions where they’re filming. Even the networks and streamers themselves.

Allow me to explain.

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When a network or streamer fully commissions content, their contract typically requires production companies to pursue any available incentives.

Usually, the production company is responsible for tackling most - if not all - of the paperwork and record-keeping involved.

In the good ole days, the production company would often receive a slice of that incentives pie for their trouble.

But that’s changed.

These days, networks and streamers often keep 100% of the incentive for themselves (minus any associated costs to the production company, like accounting and audit fees).

I get it: during these tough economic times, they need to boost their bottom line any way they can. They could even argue that since they’re paying for the content, they deserve to keep 100% of the incentive.

But in doing so, they’re destroying any, well, incentive for a production company to save the network even more money by maximizing the amount collected.

In a classic case of the principle-agent problem, one producer shared, “Why should we go out of our way to do more work when the network’s just going to keep all the money anyway?”

ADDED EFFORT - AND RISK

Let’s face it, saving money takes effort, whether you’re shopping around for the best deal on a new car or maximizing an incentive on a production.

Incentives require time — countless hours spent researching and comparing jurisdictions, determining which expenses qualify and which don’t, tracking expenses, and managing the application process (read this to find out how to make it all easier).

In this age of tightening budgets, production teams are already stretched. Many can’t fathom adding another task to their already overburdened to-do list - especially when there’s no clear “what’s-in-it-for-me.”

Maximizing an incentive might also add risk.

Broadly speaking, maximizing an incentive = maximizing local spend.

That could mean hiring more local crew (if out-of-jurisdiction labor doesn’t qualify), renting equipment locally - possibly from a shop you’ve never tried before - and even shifting post-production to an untested facility in that jurisdiction. It could involve moving shoots to locations outside major business corridors to benefit from uplifts - or even shifting production to an unfamiliar jurisdiction altogether.

Those changes help the local economy and industry - which is, after all, the main purpose of an incentive.

But working with new people, in new locations, and with new facilities adds risk and uncertainty for the production company, which could lead to delays and overages.

So to maximize an incentive, a production company must accept additional work, risk, and uncertainty … while the network collects 100% of the benefits.

Why would any sane producer go through the extra effort, and assume additional risk, for zero return?

INCENTIVES ESCAPE HATCHES

“But,” cries the network exec, “the production companies has to apply for the incentive. It’s in their contract!”

True. But a production company can point to several “escape hatches” to justify not applying for an incentive, including:

• “It only applies to local companies.” In some cases, this may be true. But often, a production company can fulfill this requirement by simply registering as a business in the jurisdiction and filing a local tax return. Any crew brought from outside that jurisdiction may be subject to local withholding. All this involves extra time and expense. It’s often worth the return…but only for the network/streamer, if they’re keeping all the incentive.

• “The jurisdiction doesn’t offer an incentive for our type of content.” This could be a legit argument for location-based content. Sometimes, though, a film commissioner might have discretionary power to grant an incentive. Sometimes, a bit of lobbying can help a film commission see the value of extending their incentive to a category of content not covered (even if it takes a season or two to secure legislative approval). Sometimes, the shoot location is flexible, but by the time people start considering incentives, everyone’s gone too far down the development rabbit hole and committed to a jurisdiction that doesn’t offer one (because they didn’t read this post).

• “We didn’t meet the minimum qualifying spend.” This might be a legitimate argument—but I’ve seen this used as an excuse when, with a little effort, a production company could have hit that target. Decisions like hiring more roles locally, booking travel through a local agent, and renting equipment locally can add up and push a budget over the threshold. But again - why would a production company assume the extra work and risk, for zero reward?

Let me be clear: Even if production companies are cut out of the incentives haul, I still strongly recommend they pursue them. As programming budgets tighten, incentives could mean the difference between a greenlight and a pass; not pursuing them could put you at a disadvantage next to companies that are. And if your allocated budget for a returning series doesn’t keep pace with inflation, an incentive could help fill the gap. I’ve also seen incentives used to cushion the blow of overages, helping everyone avoid some difficult conversations - and sparing pocketbooks on both sides.

Networks and streamers can help encourage companies to apply for every available incentive AND maximize them with one simple decision:

Offer them a slice of the pie.

The pie will only grow in response, and everyone — networks, streamers, production companies, and jurisdictions — will be better off for it.

Want to help spread the word? Hit the button below to share this post.

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Film commissions: you can also help!

How? By making it easier for production companies to film in your jurisdiction, and minimizing the risk and uncertainty they associate with working in new places and with new people.

Nurture a robust local talent pool producers can trust—especially for roles likely to be hired locally (including but not limited to PAs, second camera, sound, hair & makeup, local drone operators, gaffers, electricians, set designers/construction, and more). Make it easier for production companies to find these people via crew databases—and consider training and certification programs to help recruitment, training, and to add a layer of confidence for those hiring.

Making film permits faster and easier to obtain is a no-brainer. You can also help make your community more film-friendly by teaching local leaders and businesses about the complexities of our industry. Finally, solicit feedback from departing productions to identify any areas of improvement, and follow up on any problems they may have encountered.

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Production companies: Got some incentives-related pain points? Confused about where to begin? We’d love to hear from you.

Film commissions: Want to brag about your incentive in this newsletter?

Just drop us a line at carrie@carrieregan, or via our website.

Today, we take on what for some is the most mysterious and even terrifying part of applying for incentives:

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The audit. (insert SFX scream here)

But fear not! We’ve got your back, with advice to help you sail through the process.

Our expert this week: David Brauer.

A CPA who’s conducted audits for over twenty years, David pivoted to tax incentives more than a decade ago. As incentives programs have grown, so, too, has his firm, Brauer & Co. The company focuses exclusively on the media & entertainment industry, working in over ten US states, with a staff of over 20 and offices in California, Georgia, and New York.

“So what does an audit have to do with production incentives?” the uninitiated may ask (and trust us, we’re glad you’re asking now).

Here’s the deal: most incentives programs require that an independent party verify that your reported expenses actually qualify for their production incentive.

That’s where the auditor comes in.

Is an audit required for every production incentive?

No - it depends on the jurisdiction. Some don’t require an audit from an outside CPA firm. Some only require one if you reach a certain level of qualified spend, or for particular categories of content.

So who selects and hires this auditor?

Usually, the production company - but again, it depends. In some cases, the jurisdiction allows production companies to select an auditor from a list of those they’ve approved. Some might assign an auditor. In others, a government agency conducts the audit.

Occasionally - as with the states of Georgia or New York - the jurisdiction allows you to choose between hiring a CPA or going with a government agency audit. As David points out, hiring a CPA may be faster than working through a government agency. This could potentially speed up your payout and ultimately save you money (especially if you’ve borrowed funds to cash flow your project).

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So what happens during the audit?

Just as every jurisdiction has its own very detailed list of rules about which expenses qualify for their incentive and which don’t, they also have specific rules and processes required of an auditor. Every jurisdiction is different, so there’s no standard answer here.

Some jurisdictions require that the auditor verify a random sampling of expenses; others require a line-by-line audit (which explains why audit costs can vary so much from one jurisdiction to the next).

As David explains, his team may begin their work by conducting an account code review, to ensure that all your identified account codes qualify for the incentive in the first place.

Then (again, depending on the jurisdiction), they may ask the production company for documentation for a specific sampling of expenses (usually via a shared cloud-based folder).

When reviewing these expenses, they generally want to confirm that they meet the jurisdiction's requirements. For example, they may need to verify whether an in-state vendor is licensed in that state. For productions filming in multiple jurisdictions, an auditor may need to verify that crew labor hours have been accurately allocated among those jurisdictions.

“Sounds complicated…and a little scary,” you might be thinking.

But if you’re keeping thorough and accurate records from the start, you shouldn’t have anything to fear. And if you have a great auditor like David & team, they’ll ensure they're basing their findings on the right data.

If the auditor finds missing documents or ambiguities in your records, a good one will ask questions. As David shares, there’s always the chance that something has been filed in a way that makes sense to the production company’s bookkeeper, but not to the auditor. He’ll ensure the production company has provided all documentation before disallowing an expense. Obviously, the more accurate and detailed your records, the faster you can respond to such inquiries.

At the end of the process, Brauer & Co. will share a draft report and a summary findings with the production company. They’ll answer any questions, have the production company conduct one final review, and respond to any potential issues.

Then, the auditor will finalize the report and share it with the production company and jurisdiction.

What an auditor does NOT do

Keep in mind that an auditor is an independent party.

They won’t tell you how to keep your books, recommend specific accounting services or software, or even go into your ledgers. They won’t counsel you on how to increase your incentive or calculate how much your transferable tax credit will yield if you sell it.

As David says, “We don’t do any advisory services. There are plenty of companies out there that do. We are focused on the independent audit.”

They can clarify which expenses qualify from the outset. This help you plan better, avoid mistakes, and ensure you’re maximizing your incentive from the outset.

For example, salaries for crew brought from outside the jurisdiction might qualify for an incentive—but ONLY if they’re registered locally and pay withholding tax. There may be a cap, or maximum salary amount, that qualifies. Engaging a CPA like David early in the process - especially one with years of experience with production incentives - can help you avoid mistakes by alerting you to such nuances early on.

So how much does this cost?

Some CPAs charge an hourly rate. We’re not crazy about that approach.

Others, like Brauer & Co., charge a flat rate based on estimated qualified spend and jurisdiction. As David says, “We don't want clients to not call us because we're charging by the hour. They may say, ‘I don't want to bother them because then I'm going to get another bill.’”

Engaging with the auditor early is critical for understanding some of the nuances of these programs - especially if you’re new to incentives or just new to a jurisdiction. David shares, “People sometimes get surprised…they think something's going to qualify, and then they get our results and realize otherwise.” David’s mantra? “Ask questions, ask questions.”

A flat rate means your production company can reach out whenever you have questions, without the risk of “sticker shock” when the bill comes.

How long does it take?

David & team try to complete their audits within 3 to 6 months, but obviously, it depends on the jurisdiction and size of the incentive. “It also depends on how clean the books and records are, and whether or not that information is readily available,” David adds. Once again, accurate production accounting makes EVERYONE’S life easier—and often yields a faster incentive payout.

Selecting an auditor

When it comes to hiring an auditor for your production incentive, experience counts. This isn’t the place to save money by going with Uncle Larry who claims he can “just figure it out” (and in many places, Uncle Larry may not be approved by the jurisdiction).

David offered the following helpful tips:

• Confirm that the auditor can work in that location. As mentioned, the jurisdiction may provide a list of approved auditors. Some places require that the CPA be licensed locally, and/or have a brick-and-mortar location there. Just because you’ve had a great experience with an auditor in one jurisdiction doesn’t mean they’re able to work in another. Make no assumptions, and ask early!

• David suggests interviewing potential auditors. Ask them about their experience with production incentives, years of experience with the jurisdiction, and how many audits they’ve conducted there.

• Ask about how they structure their fees. Will they charge by the hour, or a flat rate?

• Do they have the bandwidth to conduct your audit in a timely manner? A benefit of a firm like Brauer & Co that’s focused on incentives: they won’t disappear during tax season!

• Again, don’t assume that the CPA who does your taxes will be authorized to conduct this audit. Most jurisdictions require that auditors go through their training and/or have experience with incentives. Even if it’s not a requirement, it’s in your best interest to find one who does.

Audit do’s and don’ts

• DO contact your auditor early in the process (if the jurisdiction allows. This may not be possible if a government agency handles the audit). As David says, “We charge a flat fee, whether you hire us in the beginning or the end.” There are gray areas with every program and complexities with every production. A great auditor like David will walk you through the jurisdiction’s requirements, point out the nuances, and answer any questions. “If we don’t know the answer, we can find it for you,” David shares.

• DO keep accurate records. Skimping on bookkeeping services will only cost you in the end. These days, there are plenty of online tools and even fractional bookkeeping services to make the process easier.

• DO take the time to get to know the rules of the particular incentives program.

That wasn’t so scary, was it?

Many thanks to David Brauer at Brauer & Co. for answering all our questions and helping us demystify the production incentives audit process. If you’re in need of an auditor for your next project, you can reach out to him at David@brauerco.com.

Know someone who could benefit from reading this? Hit the button below!

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Have your own production incentives pain points you’d like to share?

We’d love to hear about them. Really!

Film commissions:  Want to brag about your incentive in this newsletter?

Just drop us a line at carrie@carrieregan.com, or via our website.

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In my last role with a major media company, part of my job involved encouraging production companies to use production incentives.

It was a tough sell.

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Why? A hint:

If you guessed “the nightmare of record keeping and expense reporting,” you’re right!

I feel their pain.

These days, production managers and accountants are stretched to the limit, working across multiple projects with tight deadlines.

They barely have time to handle their regular workload, let alone sift through a mountain of expenses to separate those that qualify for an incentive from those that don’t, then file (not to mention all the pre- and post-work involved).

To quote the head of one production company, “It’s simply not worth it. We’d have to hire an additional production manager just to handle the additional work the incentive requires.”

If you’ve felt the same way, buckle your seat belt, because I’m about to rock your world.

Meet Incentiviiz, your new best friend in the world of incentives (I’ll settle for being second best).

Brought to you by the founders of the cloud-based production management system Conduiit (which is used by clients on productions for HBO, Netflix, Apple+, and Facebook Watch), Incentiviiz simplifies the production incentives application process.

How does it work?

I spoke with Conduiit and Incentiviiz founder Shawn Hamilton to find out. Shawn’s a former production accountant who’s worked at Amazon, Viacom, and HBO, so he knows our pain.

Shawn and team have made it easy. Simply link the platform to cloud-based folders (e.g. Dropbox or Google Drive folders) containing your production receipts and records.

Incentiviiz’s AI tool then goes to work, identifying and extracting expenses that qualify for the incentive in your selected jurisdiction.

Incentiviiz’s easy-to-navigate dashboard is simply elegant.

It tracks your progress toward the incentive’s minimum spend, flags any issues (like transactions lacking receipts or vendor details), and compares estimated versus actual qualifying expenses. It even keeps track of those pesky application milestones and deadlines for you.

What a dream!

How much do you pay for this magic?

NOTHING. As in NADA. ZILCH. SQUAT.

And while I’m no accountant, I’m pretty sure that’s less than the cost of hiring a dedicated production manager.

Instead of charging a fee, Incentiviiz retains a small (we’re talking single digits small) percentage of the incentive collected.

In short, it’s no risk, all reward.

And it makes the whole process easier, more accurate, and more accessible (especially for smaller production companies). When and if an audit rolls around, you can grant the auditor access to your Incentiviiz account to streamline that process as well.

The platform is customized for each jurisdiction’s program, and the Incentiviiz folks are constantly adding to their list of compatible programs.

If you’re an indie producer cash flowing your production, it gets better.

Through Incentiviiz, productions can borrow against their incentive at preferred lending rates via the platform’s banking partner. Funds are dispersed as needed rather than in a lump sum, reducing overall interest charges.

After years of hearing producers bemoan the incentives reporting process, we’re beyond excited to see this solution come to market, and can’t wait to see what the brilliant minds behind it come up with next.

Their Conduiit platform is loaded with cool features, too, including a production expense card and AI-assisted expense tracking and coding.

Want to give Incentiviiz a whirl on your next production? Drop Shawn a line at shawn@conduiit.com, and tell him Carrie sent you!

Have your own production incentives pain points you’d like to share?

Or a cool new product, like Incentiviiz, that addresses them?

We’d love to hear from you. Really!

Film commissions:  Want to brag about your incentive in this newsletter?

Just drop us a line at carrie@carrieregan.com, or via our website.

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Tax credits.

I feel ya. Anything tax-related can provoke untold angst.

But wading into tax credit waters doesn’t have to feel like this:

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For part two of our series on production incentives pain points (find part 1 here), we’re tackling how to turn transferable tax credits into cash.

To guide us, I spoke with the incredibly helpful Chad Agena, Managing Director and Head of Tax Credit Brokerage at TPC. TPC offers an array of services related to production incentives, from advocacy and administration to post-production accounting, lending, and (cue Chad) tax credit brokerage.

But First: A Word on Refundable v. Transferable Tax Credits

Before we dig in, a refresher on different types of tax credits:

In brief, with a refundable tax credit, you register as a legal entity in the state, which is usually inexpensive and can be done online (sound too complicated already? Don’t worry - Chad’s colleagues at TPC can help). You follow the necessary steps to report qualifying expenses and apply for the production incentive, which the state then issues in the form of a tax credit. Then, when you file your state return and report the credit, you’ll receive a cash refund for any amount above your tax liability in that state. Hawaii and New Mexico are two states that offer these types of tax credits.

Transferable tax credits are different.

With transferable tax credits, if you don’t have a tax liability in the state, you can sell your credit on the open market through a broker like our friend Chad. Brokers essentially hunt for a buyer (usually a corporation) looking to save on their taxes by buying credits at a discount—say, 85 or 90 cents on the dollar. You get cash for your credit, they lower their taxes, and everyone wins!

At least a dozen states offer transferable production tax credits, including Georgia, New Jersey, Illinois, Connecticut, Massachusetts, Minnesota, Montana, and Arkansas. Some international destinations do, too, including the Dominican Republic and Colombia.

Cashing in on Transferable Tax Credits

So how do you quickly and painlessly convert transferable tax credits to cash?

Chad shared these tips:

1. Find an experienced broker. As Chad says, “My job is to make people's lives easier. I want to get you paid as fast as possible, and as much as possible, and take all that work off your hands.” Music to our ears!

2. Know the difference between “discount rate” and “net to production.”

   A reliable broker like Chad will tell you from the outset exactly how much money you’ll receive on the dollar for your credit - a.k.a. the “net to production.” Chad presents clients with an engagement letter that details the net to production, which includes any fees. “If I tell them 90 (cents on the dollar) and I can’t get 90, that’s on me. I eat the difference,” he says. No hidden fees, no “sorry, turns out this was the best I could do.” We love that about Chad.

   Less scrupulous brokers will often only share a discount rate (a.k.a. the rate they’ll sell the credit for) and then tack their fees on later - an unwelcome surprise for the unprepared. So be sure to ask a broker what the “net to production” will be for your credit to ensure all fees are included in the calculation - and if they guarantee that rate.

3. Get it in writing. As mentioned, a trustworthy broker will offer an engagement letter that states the net to production you’ll receive for your credit. Depending on the situation and your requirements, such a letter can also specify the amount of time the broker has to sell the credit. “If it’s a state where we know we can sell it right away, great,” Chad says. “Within two weeks, you’ll have your money.” For tougher states, that window may be as much as 60 days, but Chad’s quick to note that they rarely take that long.

4. Bring the broker in early. You can make everyone’s job easier by reaching out to your broker early in the process (a couple of months’ lead time is best). Some credits are harder to sell than others, depending on the size of the credit, season, and jurisdiction, so it’s best to get it on the broker’s radar early. If the credit is large (congrats!) and/or in a state where the market for credits is tighter, it might take a little more time to find a buyer. As Chad notes, advanced notice will also give him time to get all parties’ accounts onboarded and a wire set up - which means you’ll get your money faster.

But Keep in Mind:

• Be wary of brokers who aren’t transparent in how they present pricing. Remember that magic phrase: ”net to production” - and get terms in writing.

• The process of brokering tax credits is essentially the same for foreign production companies; however, such companies need to make doubly sure they set up their local entity correctly or it could lead to delays and/or (gasp!) a smaller payout. Talk to a trusted tax professional. Chad’s colleagues at TPC can help you set everything up correctly and avoid any nasty surprises.

• Remember: Not all tax credits are created equal. Transferable tax credits will return different rates depending on factors like jurisdiction, size, and even time of year. Some state tax credits, like California’s, are easier to sell and will return a higher net to production, while Connecticut’s can be more challenging and yield a lower rate. Don’t make any assumptions about how much cash you’ll receive for your transferable tax credit until you talk to a broker - and if you’re selling it, never assume you’ll keep 100%.

• Refundable tax credits are a different beast. Getting 100% of a credit back (after any tax liability) may sound enticing, but states like New York have sometimes taken years to fully pay out on such credits because of yearly caps and bureaucratic delays. That could cost you - especially if you borrow against the credit. When comparing incentives programs in different jurisdictions, it’s crucial to thoroughly research the pros and cons and payout potential—or enlist the help of a professional.

That wasn’t so scary, was it?

Many thanks to Chad Agena at TPC for sharing his wisdom! If you’d like to get in touch with Chad about brokering credits (or any other TPC services), reach out to him at cagena@tpc.us - and tell him Carrie at Production Incentives Insider sent you!

Production Companies: Budgets have never been tighter, and greenlights harder to come by. We can help you leverage production incentives to make your development slate more competitive.

Film commissions:  Need help luring productions? Contact us and brag about your incentive in this newsletter!

Just drop us a line at carrie@carrieregan.com, or via our website.

You’ve poured countless hours into crafting the concept, tracking down the right characters, and cutting the perfect sizzle.

Finally, it’s time to pitch.

Meeting after meeting…call after call…when (YIPPEE!), a streamer finally shows interest.

Oh happy day!

But there’s a catch. They say your budget’s too high.

Is anyone NOT hearing that feedback these days?

You labor to tighten the budget as much as possible…but you still can’t hit their budget target.

Then the streamer asks if you’re leveraging production incentives.

“Err…sure,” you respond, secretly thinking, “Ugh, production incentives. What a headache. All that research… all that record keeping and reporting. Are they really worth the effort?”

We’ve heard that before!

To guide you through the morass, we’re dedicating the next several issues to addressing the most common production incentives pain points. That includes incentives research, record keeping/reporting, and the mysteries behind the auditing and tax credit brokering processes.

If those topics give you hives, this series is for you!

And if it can help someone you know…well, you know what to do…

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Pain Point #1: Incentives Research

So many incentives…where does one even begin?

For those new to the process, there are some basic FREE TOOLS that help take the pain out of researching incentives. Of course, rules, requirements, and funding around incentives are constantly changing, so always verify, verify, verify!

PSST! Read to the end to score a *hot deal* on a shortcut to becoming an incentives expert!

RELIABLE & COMPREHENSIVE: The Olsberg Global Incentives Index

“Old Reliable,” Olsberg’s global production incentives bible is updated twice a year. The May 2024 edition covers over 100 jurisdictions, with details on the incentives offered, requirements, budget/annual caps, deadlines, links for each program, and more.

While it’s one of the most reliable and comprehensive sources, unscripted producers may be frustrated by the lack of specifics about what types of unscripted content qualify in each jurisdiction (given that some extend incentives to, say, documentaries but not reality shows). Obviously, since it’s released twice a year, it won’t have the most up-to-date changes to programs. Regardless, the Olsberg Index offers a wealth of information, available for FREE—you just have to register to download it here.

HELPFUL FOR UNSCRIPTED PRODUCERS: Entertainment Partners (EP)

We love Entertainment Partners’ global online incentives search tool for the level of detail it offers unscripted producers. Where the Olsberg Index falls short, EP breaks the unscripted category down to indicate if an incentive applies to a variety of individual categories, including reality, game shows, animation, talk shows, post only, commercials, and video games.

The easy-to-read format details at a glance if/how the incentive applies to resident v. non-resident labor, if there are any uplifts, if a credit and audit are required, and if loan outs have to register and pay local taxes. Like Olsberg, the EP online search tool also lists contacts and websites for each program. We’ve occasionally encountered outdated information, but it’s a great starting point, especially for unscripted content. They also have a URL that’s easy to remember: productionincentives.com.

BEST FOR SIDE-BY-SIDE COMPARISONS: Cast & Crew

Wondering if the incentive is more competitive in Georgia or Illinois? Want to compare the incentive in Alabama v. Connecticut v. Arizona? The Cast & Crew site is for you.

Their unique tool enables users to quickly compare incentives in up to six jurisdictions in the US and Canada. The tool doesn’t, however, indicate which categories of content qualify in each jurisdiction. For that information— as well as details for jurisdictions outside North America — turn to its comprehensive Tip Guide (downloadable here). We love the combination of at-a-glance details and full-page breakdowns for each jurisdiction, and the introductory section is great for beginners.

REMEMBER: incentives change constantly. Don’t assume any rebates and tax credits are still valid until you verify it with the incentives administrator directly.

Have more incentives pain points you’d like us to dig into?

Reach out to us here!

Still daunted by the incentives research process?

We don’t blame you.

We’re always here to help. Just drop us a line here.

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We promised you a *hot deal* on becoming an incentives expert, and here it is:

The wonderful Association of Film Commissioners International (AFCI) is dedicating an entire in-person, hands-on workshop to the topic during their big AFCI Week event this August.

The 90-minute session, Working Through Taxes Incentives for Film Commissioners & Producers, will help producers connect with film commissioners and successfully navigate the incentives application process effectively.

It will be held Sunday, August 25th, 2024 from 4:15pm -5:45pm at the UCLA Meyer and Renee Luskin Conference Center in Los Angeles, followed by a cocktail hour from 6:00pm - 7:00pm

If you register here now, you can score a 50% DISCOUNT using the code VIPCARRIE. Space is limited (when I last checked, only 18 seats remained!).

Interested in expanding your knowledge and networking opportunities even more?  Consider attending more of AFCI Week! 

Purchase a two-day pass and be a part of the inaugural “Film Industry Challenge” - an interactive session where you and fellow industry participants play a role in identifying solutions to hurdles affecting all aspects of the production industry.  One- or two-day pass purchases using the code VIPCARRIE receive a 40% discount.  Register here - and let me know if I’ll see you there!

Production Companies: Need help navigating the production incentives puzzle? We can match your company’s production and development strengths and slate to locations that offer incentives.

Film commissions:  Need help luring unscripted productions? Want to brag about your own incentive in this newsletter?

Give us a shout at carrie@carrieregan.com, or via our website..

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I also know how complicated incentives can be. So much time-consuming research involved, so many rules, never enough time.

But we’ve got a shortcut… a way you can feel more savvy and confident about the incentives process, while cultivating a sea of contacts around the globe to help with your next production…and we’ve lined up a BIG deal, EXCLUSIVELY for the unscripted community!

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The event’s called AFCI Week, hosted by the Association of Film Commissioners International (AFCI), and it’s being held in Los Angeles this August 25-28th.

It’s projected to draw hundreds of industry professionals from around the world, with 110 film commissioners already registered to attend.

How might AFCI Week save you time & money?

Full disclosure: this isn’t the place to pitch your projects. Let’s face it: there are already enough of those.

It’s for making contacts and learning tips that can help you lower your budgets and streamline the production process, ultimately making those projects more appealing when it comes time to pitch.

And that’s critical, because these days, everybody’s expected to deliver more for less.

So picture this:

You have a brilliant idea for a survival show, but you need to bring the budget down to hit the network’s target. Or maybe it’s an animated series you’ve been developing for a while. OR an indie film that’s been drumming up interest from investors, but still has a budget gap.

You can send out dozens of queries to dozens of contacts and schedule countless calls to find out about incentives and other resources that might help move your projects forward…or you can just hit the AFCI Week Producer Happy Hour on Monday night.

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LOOK!

There’s the delegation from the Mongolian National Film Council, eager to hear about your survival show and share the success they’ve had hosting similar productions like Alone (season 5). They even suggest some local production service companies that can help you flesh out your budget.

The team from New Mexico is eager to share details about their incentive and all the resources that have made their state a hot destination for production (read the shorthand version here).

You’ve heard that you can save a bundle on animation by using studios in the Canary Islands. Sure enough, Canary Island Films is well represented. They mention that their rebate (up to 50%!) applies to animation, and hook you up with a list of top-notch animation studios.

The incentives sound enticing, but you dread all the record-keeping required. Not to worry: there are tech solutions for that! Representatives from various platforms are on hand to show how they can help take the headache out of the budgeting, bookkeeping, payroll, and incentives application processes.

(note: actual attendees are yet to be confirmed, but destined to be equally amazing).

That’s more intel and contacts than you could drum up in months.

AFCI Week’s not just about rubbing shoulders—it’s about finding real solutions, real fast. AFCI Week offers:

• An Exclusive Membership Opportunity: Snag your first chance to join AFCI as an independent producer. Learn from industry pioneers, connect with film commissioners, studios and other independent producers, and seize the opportunity to become one of the Founding50 Independent Producer Members.

• Priority Access: Get first dibs on workshops and task forces.

• Full-On Learning: Dive into incentives, collaborations, and how to squeeze every dollar out of your production budget.

If it saves you money on just one production, it’ll pay for itself.

Thinking of signing up? We don’t blame you.

AFCI Week is set for August 25-27 at the UCLA Meyer and Renee Luskin Conference Center in Los Angeles.

Unscripted producers/production companies: Knock $600 off your ticket for AFCI Week by acting now! Just click here to RSVP by June 30th, select “Carrie Regan” as your referral, and you’re in with savings.

We look forward to seeing you there!

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Production Companies: We can help match your company’s production and development slate to applicable locations that offer incentives.

Film commissions:  Need help luring unscripted productions? Want to brag about your own incentive in Production Incentives Insider?

Give us a shout at carrie@carrieregan.com, or via our website..

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Feature films and scripted series can be seductive: the big local spend, the small army of local hires, the prestige of saying Fast & Furious 10 was filmed in your country...

So why should film commissions bother with catering to relatively smaller unscripted productions?

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Because unscripted productions–including lifestyle and factual content, reality shows, and documentaries–offer a number of benefits beyond the immediate local spend, including:

• They tend to showcase your location. While locations in scripted content are frequently vague or might feature “cinematic stand-ins,” they’re often promoted in unscripted content, be it the booming culinary scene of a city, the affordable real estate of a quaint European town, or a beautiful beach resort playing host to a reality dating show. That can generate even more interest and investment in your location.

• They foster a long tail tourism benefit. Don’t take my word for it – just ask Essie Mastellari, Head of the Panamanian Film Commission. Numerous unscripted series like The Bachelor have benefited from Panama’s cash rebate program, which offers a 25% rebate on productions spending more than $500,000 locally. In turn, the country has seen a return on that investment. In showcasing the natural beauty and diverse landscapes of the country, Essie notes, unscripted production “has undoubtedly contributed to Panama's growth in the tourism sector and its standing as a compelling destination in the eyes of travelers worldwide.”

  Italy was the leading European destination for post-COVID travel among Americans in 2022, many surely inspired by Stanley Tucci: Searching for Italy (this was before White Lotus’s second season, mind you!).

• They generate economic investment. Popular HGTV series Fixer Upper transformed the economy of Waco, Texas; when COVID shut down Fiji’s tourism industry (which normally accounts for 40% of its national revenue) its established Survivor production hub kept investment flowing.

• They can help you develop your industry. With ever-tightening budgets, unscripted productions are filling more and more positions locally. Essie has witnessed this firsthand in Panama, with a “growth and development of the local production industry…creating employment opportunities, fostering skills development, and stimulating economic activity within the sector and its supporting industries.”

• They can help buffer the impact of changes in the scripted industry. Where strikes and even AI threaten to disrupt the flow of scripted productions to your region, establishing it as a welcome place for unscripted can help buffer your local industry against such shocks. Panama’s reality-friendly cash rebate kept its industry humming during recent Hollywood strikes, and it’s continued to draw productions like Mr. Beast’s 7 Days Stranded at Sea, Naked & Afraid, and Life Raft in 2023.

“Hosting unscripted productions like reality shows offers unique advantages such as genuine local engagement, enhanced tourism promotion, economic impact on small businesses, and opportunities for cultural exchange and representation. These benefits contribute to the overall promotion and development of the destination while creating meaningful connections with audiences around the world.”

- Essie Mastellari, Head of the Panamanian Film Commission

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So how can film commissions better target unscripted?

• Make sure your minimum spend for incentives is in line with unscripted budgets. Your million-Euro minimum spend requirement might be an easy bar for scripted to clear, but it could be costing you countless unscripted productions. New Mexico’s generous incentive lacks a minimum spend requirement, making it incredibly enticing for unscripted; I’ve seen an uptick in producers researching and pitching ideas for unscripted content in West Virginia purely because of the low $50K minimum spend for its incentive. If you don’t already have one, consider a lower spending threshold for unscripted.

• Consider other benefits. If you can’t offer an incentive to unscripted, are there other benefits you can extend, like location scouting assistance, media rates on rental cars, hotels, local airlines, and other vendor discounts? As budgets for unscripted shrink, every dollar counts, and such benefits could sway a production your way.

• Go easier on incentives reporting requirements. Keep in mind that unscripted productions generally don’t have a big team of production accountants behind the scenes. While monthly reporting might be appropriate for scripted, consider a more flexible timeframe for unscripted.

• Promote your location to the right people. Film commissions often target studio executives when pitching their locations, which makes sense given the extent to which studios influence location selection. For unscripted content, however, production companies rather than networks are often the main drivers behind location choice. If you’d like to lure the next beach reality show, survival show, historic home renovation series or culinary competition, find out which companies are producing that kind of content and pitch to them, not (just) the networks.

Film commissions:  Need help luring unscripted productions? Want to brag about your own incentive in Production Incentives Insider?

Just reach out to us at carrie@globalcontentstrategies.com, or via our website.

Production Companies: We can help you match your company’s production and development slate to applicable locations that offer incentives.

Give us a shout at carrie@globalcontentstrategies.com.

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But before taking it to the network, you plan to see if the shoot location offers incentives.

Smart, right?

Not so fast.

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During these challenging times, when commissions are harder to land and budgets shrinking, it’s time to rethink how we’re doing things.

And it starts with development.

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For a certain portion of your development slate, try starting with incentives, and developing content with them in mind.

How?

An example: A network is looking for a series about haunted houses to air around Halloween.

Rather than casting a wide net, try starting your search in Louisiana, which – in addition to offering lots of local color and haunted lore – boasts a generous 25-40% refundable tax credit on local spend.

The benefits:

• Your development process becomes more targeted.

• From the outset, you can plan production in a way that maximizes local spend.

• When it comes time to pitch, you can lead with, “Because of Louisiana’s incentive, we can do it for less.” Music to any network exec’s ears!

There are other reasons to develop your show starting with incentives.

As we’ve all experienced, it’s easy for a content commissioner to become wedded to a location once the concept is pitched – and often difficult to change it afterwards.

For example: you’ve developed a survival competition show in Alaska that the network just LOVES.

But you could have saved fat stacks of cash by filming in Mongolia, with its 30-45% rebate on local spend, or Canada’s Yukon, where productions can benefit from both federal and local incentives.

Alaska, tho? No incentive.

Yet the network’s already tied to the idea of Alaska because that’s how you pitched it, and there’s no going back. And oh yeah: they still need you to shave 20% from your budget or it won’t fly.

Starting with incentives allows you to kick off your pitch with an enticing plus: a competitive price.

And that can make the difference between a greenlight and a pass.

It won’t work for all shows. Sometimes your talent or subject is tied to a certain location. With or without an unscripted incentive, some food/cooking shows are always going to want to go to Italy, because, well, Italy. Or the network may already have too many shows set in a particular location. It’s not a bad idea to do your research and/or ask.

Still, for the right types of shows in your development portfolio, it’s worth it to experiment with letting incentives drive the process.

Need a hand figuring out where to start?

We can help match your company’s production and development slate and strengths to applicable locations that offer incentives.

Just drop me a line at carrie@carrieregan.com.

And stay up to date on future posts by clicking the button below.

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Film commissions:  Time to brag about your own incentive!

We’d love to feature you in Production Incentives Insider. 

Just reach out to us at the email above, or via our website.

It’s a production paradise!

Sound too good to be true?

Think again.

A number of spectacular locations around the world offer production incentives, making shooting in paradise more affordable than you might think.

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They include:

THE DOMINICAN REPUBLIC

The Dominican Republic has been attracting productions for decades, including Pirates of the Caribbean, Jurassic Park and the more recent The Lost City and Shotgun Wedding.

On the television front, the country has hosted countless international versions of Survivor, the Bachelor/Bachelorette franchise, and Paradise Hotel.

“The DR” offers a wide range of locations, from tropical jungles and beautiful beaches to deserts and rich historical architecture.

Given its robust production scene, you’ll also find experienced crew, equipment, stellar private resorts accustomed to hosting productions, and studio space, including Pinewood Studios’ water filming facilities.

On to the incentive: the Dominican Republic offers a 25% transferable tax credit on eligible expenses with a $500K minimum spend, and unscripted qualifies (including reality). There’s no per-project cap, and resident and non-resident labor qualifies (subject to withholding and a 25% local labor requirement).

To apply, you must either work through a local service provider that’s registered with the Film Commission or register your production entity locally.

Find out more here.

PANAMA

Panama boasts beautiful beaches, lush tropical rainforests, and over 1,000 islands for your filming pleasure. Unscripted and reality content qualifies for its incentive, making it ideal for dating and survival/competition formats. Indeed, it’s hosted various versions of The Bachelor, Survivor, and Amazing Race.

It’s also considered outside the hurricane belt, and its mainland location means prices are generally lower here than on Caribbean islands. That said, productions located further from the capital may understandably encounter more logistical challenges.

Panama’s rebate on qualifying spend recently jumped from 15% to a generous 25%, including resident labor, against a $500K minimum spend.

COLOMBIA

Colombia has lots to offer, including diverse locations that include major cities, historic architecture, dense jungles, and sandy beaches. Add a strong local talent pool, easy access from the US, and an incentive and it’s no wonder Colombia has become an industry hotspot, drawing productions like Freelance, Sound of Freedom, Lost City of Z, and the series Narcos.

The country offers a choice between a 20-40% rebate (depending on nature of the expense) OR a 35% transferable tax credit when working through a local service provider, while minimum qualifying spend hovers around $475K.

Unscripted and reality qualify here as well, and it’s lured multiple versions of the popular reality series Naked & Afraid.

TRINIDAD & TOBAGO

Nestled in the southern Caribbean, the twin islands of Trinidad and Tobago offer a contrasting variety of locations.

Home to the capital city of Port of Spain, Trinidad offers more urban flair, with historic architecture, music festivals, and its annual Carnival. Tobago, in contrast, is the go-to spot for secluded beaches, tropical jungles and private beachfront villas.

While it might not have as robust a production infrastructure as other locations mentioned, it’s one of the most affordable locations in the Caribbean, with a 12.5 - 35% sliding scale rebate starting at just $100K in local spend – plus a 20% bonus rebate on local labor.

Both scripted and unscripted qualify (including reality). Plus, these islands are considered outside the Caribbean hurricane belt.

The islands were the setting of classics like Dr. No (1962) and Swiss Family Robinson (1960), as well as recent episodes of Naked & Afraid, Amazing Race and Love and Hip Hop. While rules state that 50% of a production must take place on the islands, they may be flexible for the right projects.

HAWAII

In 2023 Hawaii bumped its refundable tax credit up to 22% (for Oahu) and 27% (for the Big Island, Kauai, Lanai, Maui, Molokai), while lowering its required minimum spend to a mere $100K, making it more accessible to unscripted productions (they qualify!).

Resident and non-resident labor qualify, though productions are expected to make “reasonable efforts” to hire local crew and maximize in-state production spend.

Countless productions have taken advantage of Hawaii’s steller locations, services and scenery, including White Lotus, Forgetting Sarah Marshall, Jurassic Park, Hunger Games: Catching Fire, Lost, Godzilla…plus reality series like The Bachelor, Top Model, Top Chef, Temptation Island, and more.

And that’s not all!

A number of other tropical jurisdications have recently rolled out or modified their incentives offering, including the Philippines, Thailand, Malaysia and Fiji, expanding your options for filming in paradise.

And we’re keeping an eye on:

Barbados: The Caribbean island nation recently lured an episode of Succession to its shores by offering an incentive, but we’re told that final details on its formal incentive program are still winding their way through the legislature.

Ghana: The West African nation recently announced a 20% film production tax rebate, with further details forthcoming. We’re watching!

Of course, filming in paradise can have its drawbacks. Goods and services on islands can be more expensive than on the mainland. In the Caribbean, you have to watch out for hurricane season (June-November), while cyclones are a factor in the Pacific. Tourist season can call out the crowds and higher prices.

As always, each program carries its own rules and qualifications that are subject to change, so be sure to double-check the details.

Need help wading through the options? Give us a shout at carrie@carrieregan.com.

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Film commissions:  Time to brag about your own incentive! We’d love to feature you in Production Incentives Insider. 

Just reach out to us at the email above, or via our website.

Last week we covered the first five crucial questions to ask when considering production incentives.

Now, we hit the back half of our top ten, including some details that could really cost you – or help you save even more money.

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Let’s dig in.

6. Are there any bonuses or extras I should consider?

It’s possible.

Various jurisdictions offer bonuses, or “uplifts,” if your project meets certain criteria.

New Mexico’s base credit of 25% can swell to 40% with uplifts that include:

• an extra 10% for filming more than 60 miles from Santa Fe and Albuquerque

• an extra 5% for TV series and pilots that meet specific conditions

• an extra 5% for using qualified in-state production facilities (like soundstages)

Planning ahead and simply shifting a shoot location could substantially increase your incentive.

Mongolia’s base 30% rebate could return even more given their 10% bonus for culturally relevant content and 5% foreign talent reimbursement.

Some producers may rule out an incentive because their project doesn’t meet the required minimum local spend. But some programs, like Georgia’s, allow companies to bundle their spending across multiple productions to meet their threshold. For jurisdictions where the level of the incentive increases with your local spend, bundling could push you into a higher bracket and save you even more.

Jurisdictions often offer informal money-saving benefits to productions, too, like free assistance with location scouting or media rates on accommodations and vehicle rentals. It never hurts to ask.

7. What about foreign/out-of-state labor – can I collect an incentive on that cost?

This depends heavily on the jurisdiction.

In some, the incentive applies; in others, foreign/out-of-state labor qualifies at a reduced rate. It may depend on the role. Occasionally, a salary cap may apply.

In any case, be sure to check the specifics. It might make great financial sense to hit up that local labor pool!

Note that some jurisdictions require foreign/out-of-state labor to register and pay local payroll taxes. A payroll service like Entertainment Partners, Extreme Reach, Cast & Crew, or Wrapbook (among others) can help streamline the process.

8. Is there a limit to how much a single project can receive?

Almost always!

Keep an eye out for caps, which may include:

• caps on the total amount a single project can receive

• annual caps on the total amount of funds the jurisdiction has available for a given period

• caps for specific spending categories (like talent and crew salaries)

As you compare incentives programs, pay careful attention to any caps that might limit the amount your project could receive.

9. What’s all this talk about a “cultural test”?

If you’ve looked into international incentives, you may have seen references to a “cultural test,” like this one for the UK, or Malaysia’s, in Appendix C of this document.

People often mistakenly believe that their project needs to be 100% editorially focused on a country or culture in order to pass the cultural test, but that isn’t entirely true.

The cultural test usually evaluates a project in three areas:

1. Favorable portrayal of the jurisdiction while featuring its locations and/or recognizable destinations.

2. Inclusion of cultural elements like food, wine, language, and local traditions.

3. Use of local on-camera talent and/or crew in designated roles.

Cutural tests often award points for each category, so your project may still pass even if it doesn’t nail all three categories.

If you’re planning to target a particular incentive, it’s important to review the cultural test and plan accordingly. I know of at least one unscripted project that missed out on an incentive worth hundreds of thousands of dollars because they hired a DP from the US instead of the EU. If you’re not doing your research, a single decision like this could cost you.

10. Who applies for the incentive…the production company, network, or…?

This varies.

Sometimes, a local entity must apply. That may mean applying through a local service provider. Alternatively, a production company may be able to easily set up a local entity of their own.

In other cases, a production company can apply even if they’re foreign/out of state. Occasionally, it might make sense for the broadcaster/streamer/studio to apply instead—especially if they have a tax liability in the jurisdiction that allows them to take full advantage of any tax credits, and/or if they’re able to bundle a number of productions from different production companies that individually don’t meet minimum spend requirements.

Have questions of your own about incentives? We’re here to help.

Drop me a line at carrie@carrieregan.com, or via our website.

And stay up to date on future posts by clicking the button below.

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Film commissions:  Time to brag about your own incentive!

We’d love to feature you in Production Incentives Insider. 

Just reach out to us at the email above, or via our website.

Some run enthusiastically toward the water. Others tiptoe in tentatively.

Either way, watch when that first terrifying wave comes crashing in.

More often than not, the kiddos turn tail and race back to the safety of the shore.

The same goes for producers and incentives.

At first they’re intrigued…but as the inevitable wave of rules and requirements descends, many get scared off.

I get it.

There are lots of details to consider with incentives, and every program is different.

It can all get pretty overwhelming.

But ten simple questions can help you determine if an incentive is right for your project from the outset—and keep you from wasting valuable time if it isn’t.

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Here are my first five:

1. Does my content qualify?

This one seems obvious, but it’s tricker than you might think.

First, there’s content type. Scripted often qualifies (okay, not adult films).

But with unscripted, the rules get granular. Documentaries might qualify, but not reality TV. And even if it appears that unscripted doesn’t qualify, dramatic or historical recreations might, even if they’re part of an unscripted series. Sometimes, unscripted incentives are up to the discretion of a local commissioner or panel.

Post, animation, and SFX qualify for incentives in some jurisdictions, regardless of whether you’re doing any actual filming there.

Most places have minimum local spending requirements. Some may require a minimum number of filming days in the jurisdiction, too, and/or a minimum number (or percentage) of local hires.

So as a first step, check to see whether your content qualifies.

2. How far in advance do I have to apply?

Deadlines are all over the place and depend on the jurisdiction.

For example, Ohio has just two application windows a year. The 2024 application period for the Yukon opens on March 18; they’ll continue to accept applications and distribute funds until they hit their yearly funding cap. If that happens before you apply, you could be shut out of funds for the year.

Many places require applications 60 to 90 days before principal photography, while others may accept applications even after filming has begun.

If you’re interested in an incentives program, make sure you look into application deadlines or you could miss out.

3. What expenses actually qualify?

Generally speaking, a cost has to be incurred within the jurisdiction to qualify. So renting equipment from a local vendor could save you a tidy sum over renting it outside the jurisdiction and bringing it in.

Travel costs qualify in some places (especially if booked through a local agent), but not others. Same with out-of-state/foreign labor: depending on the program, those costs could qualify for the full incentive, at a lower rate, or not at all.

Most jurisdictions have a detailed list of what qualifies, like this one for the state of Georgia. Careful planning can help you maximize savings – and keep you from counting on receiving money back on expenses that don’t qualify.

4. When will I see the money?

The timeline depends on the type of incentive (check out our earlier post on the subject here). Rebates and grants often pay out fastest, followed by transferable tax incentives if you’re selling them. But you could be waiting over a year (or more) to see money from a refundable tax incentive.

5. Are there any costs I’m overlooking?

Some jurisdictions will have an application fee, and many require an audit, which isn’t cheap.

Make sure you’re considering all costs to determine whether an incentive is worth pursuing.

Helpful? We’ve got five more questions to go in Part Two!

Hit the button below and you won’t miss out:

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Have questions of your own about incentives?

Drop me a line at carrie@carrieregan.com.

Film commissions:  Would you like to be profiled in an upcoming issue of Production Incentives Insider?  Reach out to us at the email address above, or via our website.

Yet many unscripted producers continue to ignore a valuable source of potential funding, at their own peril: production incentives.

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Mention incentives to producers of unscripted content (e.g. documentary, lifestyle, factual, reality) and they might shrug, thinking they’re only for big budget scripted productions.

Or that they’re too complicated. Or simply not worth the hassle.

But when it comes to filming in the US, there are dozens of states (and even counties and cities) that offer substantial incentives you might not be aware of—and unscripted content qualifies.

If you’re an industry veteran who’s never tapped incentives, why bother learning about them now?

Because as you continue to ignore them, your competition isn’t.

And guess what? They’re pitching similar content, to the same networks and streamers, at an incentives-subsidized lower price point — at a time when everyone’s tightening their programming budgets.

Who do think is going to land that greenlight?

But fear not! We’re here to guide you.

Here are just three valuable US state incentives that can help you deliver more, for less:

CONNECTICUT

When it comes to locations, Connecticut covers a lot of ground: from cities and quaint towns to seaside villages, historic homes and the natural beauty of the Taconic Range. Its incentive has helped turned Stamford, CT (less than an hour commute from NYC) into a bustling production hub.

THE DETAILS:

• Connecticut's transferable tax credit is tiered, at 10% for $100-500K in eligible spend, 15% for $501-1M, and a generous 30% for over $1 million in local spend.

• Digital animation and post qualify!

• Resident & non-resident labor qualifies (withholding required)

• Productions qualify if they meet any of these criteria:

  • Minimum 50% of principal photography days take place within CT OR

  • Minimum 50% of post costs spent within CT OR

  • Minimum $1 million in post costs in this state.

• Find out more here.

KENTUCKY

• The Bluegrass State is about more than bourbon and beautiful horse country. Locations include cities, small town Americana, Appalachian wilderness and more.

• Kentucky offers a hefty 30-35% refundable tax credit (a 5% uplift is offered for production in certain counties)

• The minimum local qualifying spend is $250K ($125K for Kentucky residents) for film/TV and $20K ($10K for Kentucky residents) for documentaries.

• Reality qualifies! 

• The state allocates a generous $75M annually for these production incentives.

• Non-resident labor qualifies for the 30% credit (they must register). There’s a 5% bonus for Kentucky crew, with a growing pool of searchable local talent via the Reel Scout database, which is maintained by the Cabinet for Economic Development.

• Find out more here.

NEW MEXICO

New Mexico has been steadily luring production powerhouses, with Netflix committing $2 billion in production spending in the state over the span of ten years and NBC Universal building a $4.4 billion TV and film studio.

It isn’t called the Land of Enchantment for nothing: its stunning natural beauty (National Parks, rugged deserts, snow capped mountains) is the stuff of legend. But it offers plenty more to get the creative juices flowing, including cities, ghost towns…and let’s not forget this place.

• New Mexico offers a refundable tax credit of 25-40%, which includes various bonuses (e.g. 10% uplift for filming outside Santa Fe & Albuquerque, uplifts when using qualified production facilities, and more).

• No required minimum spend!

• For union productions, there's a decent size union crew base (2,000+ members)

• The state’s generous yearly incentives budget of $120M will increase by $10M every year until 2029 to grow with demand.

• Competition shows, VR, video games, music videos, animation, indie films, post production–it all qualifies (assuming it meets other eligibility criteria).

• Non-resident labor qualifies for a 15% credit (guidelines apply)

• Find out more here.

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This is just a quick summary. Each state program is unique, with its own requirements including application deadlines, rules on qualifying content and spend, caps, auditing requirements and more. 

If that all sounds overwhelming – or if you’re confused about details like the difference between refundable and transferable tax credits – don’t worry! 

We can help you make sense of it all.

For more details on the incentives above, global incentives in general, or how you can tailor your development strategy to best take advantage of the billions available in incentives yearly, drop us a line at carrie@carrieregan.com.

Film commissions:  Would you like to be profiled in an upcoming issue of Production Incentives Insider?  Reach out to us at the email address above, or via our website.

And be sure to subscribe below if you’d like to receive the Production Incentives Insider before the masses!

Then you start digging into the details…SO many details. It’s enough to cause anyone without an accounting degree to go running for the hills.

I’m often asked about the difference between the types of production incentives offered. I’ll caveat that I’m no accountant, but I can offer a basic breakdown of the four main types of production incentives you’ll encounter and what they mean for your production.

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REBATE

These are the holy grail of production incentives (note: some places have grants, which are similar). It’s straight-up cash that the jurisdiction will pay to a production entity (generally a percentage of qualifying spend in the jurisdiction). Because this type of incentive is not contingent on filing a tax return, they generally pay out quickly—sometimes in less than three months. Malta, Mongolia, Morocco, Mississippi, and Minnesota all offer production rebates. And lest you think it’s just an “M” thing, so does Colorado—and various types of unscripted content qualify in all of them, too.

REFUNDABLE TAX CREDIT

These are also pretty juicy. Basically, the production entity files a return in the state, and any amount of credit above and beyond their tax liability will come back in the form of a cash refund. If the production entity has no tax liability, upon filing, they’ll receive a rebate in the full amount. Hawaii and New Mexico are just two US states that offer refundable tax credits, and as above, various types of unscripted content qualify. Keep in mind, however, that depending on the timeline for filing a return, you may not see your cash for over a year.

TRANSFERABLE TAX CREDIT

Transferable tax credits require a little more legwork. The full value of the credit can be applied against the production entity’s tax liability in the jurisdiction OR – if they have no tax liability - the credit can be sold on the open market, usually at a discount.

There’s often a decent market for these credits (for the buyer, it’s like buying a discount on your tax bill), and broker services to handle the transactions. If you simply sell the credit, you’ll likely get your cash faster than you would with a refundable tax credit, since you don’t have to wait to file a return.

One point of caution: if you know you’ll be selling/transfering a tax credit, be sure to factor the discount rate into your accounting, or you might be surprised when that million-dollar incentive your were counting on turns out to yield only $900K. The Dominican Republic and US state of Georgia offer transferable tax credits, and unscripted qualifies.

NON TRANSFERABLE, NON REFUNDABLE TAX CREDIT

These are the most restrictive, as the production entity can only apply the credit against their own tax liability. Often, if the amount of the credit exceeds the company’s tax burden, they can carry the credit forward and apply it to their tax bill for a given number of years. The downside is that the production entity might not recoup the full value of the credit for several years. This type of credit is less common, however.

Note that some jurisdictions offer additional non-traditional incentives, like exemptions on hotel, sales & use taxes or waivers on permit fees. It’s always worth asking what might be available.

That wasn’t so bad, right? As always, there are often plenty of caveats when it comes to production incentives, including minimum spend requirements, hiring requirements, application deadlines and more. Some states require out-of-state production companies to register and for out-of-state crew to pay local payroll taxes in order to receive their incentive. Audits are generally required, and they’re *not* free. A (real) production accountant can help you determine if these additional costs negate the value of an incentive for your production.

Still confused? Don’t worry!  We can help you make sense of it all!

For more details on US and international incentives and how you can tailor your development strategy to best take advantage of them, drop Carrie a line at carrie@carrieregan.com. Or let us know what topics you’d like to see covered in an upcoming issue.

Film commissions:  Would you like to be profiled in an upcoming Production Incentives Insider?  Reach out!