Ant-Man. Stranger Things. Ozark. What do they have in common? Well, other than bizarre creatures, (yeah, Ozark too), these productions all filmed in Georgia. Additionally, they likely all were lucky enough to receive Georgia film tax credits. And if you’re thinking about filming there, your production team can save a little money too.
In this article, we'll cover the most frequently asked questions around the Georgia film tax credit program. This includes who qualifies for Georgia film incentives and what expenditures Georgia tax credits cover.
First things first...
A Georgia film tax credit is a financial incentive that encourages production companies to film in Georgia by providing them with savings (or tax benefits).
The Georgia Department of Economic Development (GDEcD) is the governing body that certifies projects which qualify for the film tax incentive. The Georgia Department of Revenue (GDOR) is the department that manages the earnings and claims of the credits.
The tax credit may be used against the taxes your production team may otherwise have to pay in Georgia. If the production company chooses, they can sell or transfer the tax credit to one or more Georgia taxpayers — either individuals or corporations.
Now, you may be wondering: how much is the tax credit? The Georgia Entertainment Industry Investment Act outlines this.
So glad you asked!
The Georgia Entertainment Industry Investment Act (GEIIA) gives a 20% tax credit to companies that spend $500,000 or more in Georgia during production and post-production. This can include a single production or the total of multiple projects aggregated in a single tax year.
On top of that credit, the state also has a Georgia Entertainment Promotion (GEP) Uplift credit. This is an additional 10% tax credit for certain approved projects that include a five-second-long embedded Georgia logo in the finished and commercially distributed product. This needs to be included in the initial public screening, and the project's promotional website must include this link, (Explore Georgia film site).
Under the act, the Georgia movie tax credit is available to both Georgia residents and non-residents. There is a salary cap of $500,000 per person, per production, when the employee is paid by “salary,” which is defined by the Georgia film incentives website as being paid with a W2.
If the production company pays an individual for services as a loan-out, a personal services contract, or a 1099 individual meets the criteria for a loan-out, then Georgia income tax must be withheld and remitted by the production company for those costs to qualify. There is no salary cap on individuals paid through 1099, personal service contract or loan-out.
Payments made to a loan-out company in 2021 will require 5.75% Georgia income tax withholding.
Only production companies are eligible. Fortunately, production companies don’t have to be incorporated or have their headquarters in Georgia. They also don’t need a Georgia bank account to qualify for the Georgia film tax credit.
To earn the 20% film tax credit, the Georgia Department of Economic Development must certify the project (more on this later).
Qualified projects’ distribution must extend outside the state of Georgia and have a minimum of $500,000 qualified in-state expenditures over a single tax year.
While interactive games and digital media projects do not qualify for Georgia film incentives, they may qualify for digital media tax credits.
To qualify for the Georgia tax credit, production expenditures must be made in Georgia from a Georgia vendor. This can include cast, crew, storyboarding, other casting needs, set design, wardrobe, makeup, props, and location.
Sound recordings used in qualified feature films, television movies or specials, television series (including motion picture soundtracks produced in Georgia) are qualified expenditures but licensing fees are not eligible.
Post-production expenditures for Georgia-filmed movies and TV projects including editing and color correction qualify under the Georgia film tax credit guidelines, but they must be done in Georgia.
However, any qualified production expenditures claimed under the post-production tax credit or music tax credit are then not eligible for the Georgia movie tax credit (so in other words, no double dipping on tax credits).
If you are looking for more information about the post-production film tax credit for eligible post production companies, contact the Georgia Department of Revenue.
Development costs, promotion, marketing, story rights, and legal fees are not qualified expenditures.
View the full list of qualified expenditures on the Georgia Department of Revenue website.
Georgia Film Office recommends submitting your application as soon as the project is green-lit, fully funded, and ready to open a production office. The Georgia film tax credit program accepts applications for live-action projects within 90 days of the start of principal photography but must be done before the end of principal photography.
The application for live-action projects will ask you to provide a few things.
Within the application for live-action projects, you’ll notice that the Georgia Film Office asks you to agree to supply a few additional things.
If you are applying for the 10% Georgia tax credit, (the Georgia Entertainment Promotion Uplift credit) you’ll also need to specify where the link to this site will go and where the logo will be placed.
For this, be sure to also fill out the GEP Uplift logo application.
This placement should be located:
Now all that's left is to send it in!
Georgia Department of Economic Development (GDEcD)
75 Fifth Street, NW, Suite 1200
Atlanta, Georgia 30308
Once your application is processed and approved, your production company will receive a certification letter from the Georgia Department of Economic Development. The base certification letter will reflect the 20% tax credit. After the release of your project, if it meets the logo requirements, you’ll receive an additional certification letter for the 10% Georgia movie tax credit.
If required, under Georgia film tax credit regulations, your production company may be asked to complete an audit before filing a state tax return. Under Georgia House Bill 1037, the requirement that applicants undergo an audit for their projects before claiming or selling a credit will be phased in gradually.
Audits are required for credits first certified in 2021 and worth more than $2.5 million. This amount decreases to $1.25 million for productions certified in 2022. Beyond 2022, audits may be required prior to claiming, utilizing, or transferring a film tax credit of any amount.
You can find more information on audits via Georgia’s film incentives page.
You can also see a list of certified eligible auditors on the Georgia Department of Revenue’s site.
Say it ain't so. After all this hard work of applying, could the state be taking it away?
Well, though Georgia House Bill 441 has been introduced because some say it's a financial burden on the shoulders of taxpayers, it will likely have a hard time passing. But we will be checking back regularly and updating this as needed.
Gaining Georgia film incentives can be a great way to mitigate other project expenses.
If you’re hoping to film in Atlanta, be sure to check out our Atlanta film permit guide.
At Wrapbook, we're all about providing the very best free resources to producers and their crews. However, this post is not a substitute for professional legal advice. Answers do not create a company-client relationship, nor is it a solicitation to offer legal advice. Seek the advice of a licensed attorney in the appropriate jurisdiction before taking any action that may affect your decisions or rights.
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