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The Wrapbook Team consists of individuals who are thrilled about building modern software tools for creators. We’re a team of compassionate and curious people dedicated to solving complex problems with sophisticated solutions. You can find us across the U.S. and Canada.
At Wrapbook, we pride ourselves on providing outstanding free resources to producers and their crews, but this post is for informational purposes only as of the date above. The content on our website is not intended to provide and should not be relied on for legal, accounting, or tax advice. You should consult with your own legal, accounting, or tax advisors to determine how this general information may apply to your specific circumstances.
Qualifying for the right production incentive necessitates a lot more than simply choosing the program with the most attractive headline rate.
Each jurisdiction has its own requirements, funding structure, and administrative process. That can make it difficult to decide where to shoot, when to apply, which costs qualify, and what records to maintain.
Start with the relevant film office and tax or economic-development agency to identify the application, entity-registration, withholding, insurance, financing, and production documents your project may need. As Ryan notes, every program is different.
“One state might be as simple as ‘Hey, make sure you fill out this single-page application or intent-to-film page 10 days before you start filming,’ and you're in the system. Others might require setting up you know, local companies, local withholding accounts, and a few other hurdles to jump over.”
You’ll want to do this well in advance of your shoot. Some programs are capped or funded through limited annual appropriations, so confirm that funding or allocation capacity remains available.
While researching, Ryan encourages you to ask detailed questions to avoid pitfalls. Is there an application fee? Are there multiple filing, audit, transfer, or administrative fees? Which costs must be incurred after approval? When can payment reasonably be expected?
The earlier you understand the process, the better your chances of submitting a complete application and building a realistic incentive estimate.
Once you’ve confirmed that the incentive program is funded and your project is eligible, it’s time to prepare the application and supporting materials.
Every jurisdiction follows its own timeline, and a missed deadline can reduce or eliminate eligibility. Many programs require an application before principal photography or before qualified spending begins.
“Louisiana lets you go a year backwards from your allocation letter. Georgia, you can apply all the way up until the end of principal photography.”
Whatever the jurisdiction, prepare as thoroughly and as early as possible.
Approval is only the beginning. If and when your production qualifies for an incentive, you’ll need to maintain careful records to document that you are meeting all relevant requirements.
And would you be shocked to learn that reporting requirements vary considerably by jurisdiction?
For instance, if you’re shooting in Utah, where they only incentivize local hires, the state will want to take a look at your payroll reports to make sure you complied. They will want to see how many hours these locals worked and what fringes they were paid.
Other states may examine withholding, residency documentation, vendor status, proof of payment, and minimum-spend calculations. If there are minimum spend requirements, e.g. you have to spend at least $50,000 in state to qualify for the incentive, you’ll need to verify that those thresholds were met.
Even if reports are not due until after production, organize the supporting records as costs are incurred. Ryan offers Mississippi as an example:
“Mississippi has a whole hyperlink Excel sheet that they give you, and I recommend people get in front of that form early. Start working on it as you're going through production. They want hyperlinks to every payroll, every cost, every vendor in this sheet, and if you're doing it with production it's not so bad. If you're doing it retroactively, you might need some help.”
Not all incentives—or production locations—are created equal. It’s important to consider the full financial and operational picture when identifying which incentive is the right fit for your next project.
First, choose the right state for your production.
Start by identifying locations that satisfy your creative and production needs, then compare the incentives available in those jurisdictions.
Eligibility can vary by production type, distribution plan, budget, shooting schedule, and spending pattern. Review the minimum spend, qualified production categories, application window, and treatment of resident and nonresident labor for every program under consideration.
Program structure matters, too. Tennessee’s Film/TV Fund, for example, is a discretionary grant awarded through a grant contract after state review, while Connecticut offers a tax credit for qualifying digital-media and motion-picture production and post-production expenses.
Budget is another factor. New Mexico currently has no minimum spend requirement, while Massachusetts and Mississippi both have low thresholds. Low minimum spend requirements can make an incentive more accessible, though it does not guarantee that every expense, or project, will qualify.
Infrastructure can be just as important as the incentive. Established production hubs such as Georgia have experienced crews, vendors, facilities, and other resources to support productions of all sizes and type.
But be sure to research availability before committing to a location. A strong incentive may not offset limited crew capacity, higher travel costs, or the need to bring equipment and vendors from another state.
Because so many variables affect an incentive’s net value, Ryan encourages producers to model the complete cost of each location before deciding.
“If you're from California and you work with a particular camera vendor and they just give you an amazing discount, don't just assume, ‘Well, I'm going to a particular state, so I got to find a camera package there.’ Because yeah, you might get the incentive on it, but is it cheaper than the one that you have that you've been using and have connections to?”
Also compare the likely net value of refundable and transferable credits. A 25% transferable credit may produce less cash than a 20% fully refundable credit after market discounts, fees, timing, and financing costs are considered.
Bottom line: do not chase the highest headline percentage. Model qualified spend, exclusions, caps, uplifts, fees, audit costs, monetization discounts, and payment timing.
Once you’ve run your numbers and confirmed the rules, you can focus your application effort on the programs that offer the strongest overall fit.
Film incentives are a boon to both production and local economies. Given that, Ryan expects incentives to remain an important part of the U.S. production landscape, even as program design and funding continue to evolve.
One high profile example of a production incentive’s impact is Senoia, Georgia, home of The Walking Dead. Struggling as the local agricultural industry declined, Senoia was reborn in 2008 after Georgia film incentives welcomed production to the state. The now booming town boasts a thriving retail district with 49 businesses, up from just six at its lowest.
Success stories like Senoia show why jurisdictions continue to compete for production activity. Increasingly, incentives are designed to develop local workforces, encourage regional investment, and produce longer-term economic benefit.
Many incentive programs also seek to broaden access to production employment. Illinois, for example, requires applicants to submit a diversity plan and document good-faith efforts to hire a crew that reflects the diversity of the state.
Other states have followed suit. California, Oregon, and New York, among them, all have diversity plan provisions aimed at encouraging inclusive, representative hiring both above- and below-the-line.
According to Ryan, more jurisdictions are encouraging local hiring and tying incentives or bonus opportunities to workforce development, training, and community investment.
Productions may be asked to hire local interns, participate in training initiatives, or support other workforce-development efforts. These provisions can help jurisdictions build a deeper, more sustainable production labor force.
Finally, Ryan expects local incentives to remain important. For instance, Louisiana has a statewide program, while local jurisdictions, including Jefferson Parish, offer additional opportunities under their own rules.
Florida’s statewide film industry tax credit expired in 2016, yet filmmakers can explore a wide offering of regional productions incentives across the Sunshine State, including cash rebates and grants in Broward County (Fort Lauderdale), Duval County (Jacksonville), Hillsborough County (Tampa), Orange County (Orlando), and Pinellas County (St. Pete–Clearwater).
This kind of competition is great for productions, who can better align their applications with areas that best fit their needs. And regional production incentives are a great way for municipalities and counties to attract spending, create jobs, and strengthen their production infrastructure.
Production incentives can be complex, but they become much easier to evaluate when you start early, confirm the current rules, and build your budget around qualified spend.
For more information on how to make the most of these programs, check out Wrapbook’s Production Incentive Center, where you can compare programs and identify the right opportunities for your next project, or drop Ryan a line to chat.
Production incentives can be a godsend to your film’s budget. The money granted through these state-funded programs is pumped back into your bottom line, allowing you to stretch each dollar you put on screen.
But how do these incentives work? How hard are they to access? And what do you need to know before applying?
To get some answers, we spoke with Ryan Broussard, Wrapbook’s VP of Sales and Production Incentives. For nearly two decades, he has helped projects of all sizes navigate state and local production incentive programs.
Ryan has helped productions evaluate incentive opportunities, improve reporting workflows, prepare for audits, and navigate program requirements. He has also advised states and local jurisdictions, helping design, develop, and refine their incentive programs.
His knowledge and experience makes him an essential member of the team at Wrapbook, and not just behind the scenes. Ryan also hosts educational events on production incentives and contributes to the Wrapbook blog.
It's a question Ryan fields constantly. Production incentives are economic-development programs designed to attract production activity and related spending to a jurisdiction. In return for meeting program requirements, a qualifying production may receive a tax credit, rebate, grant, or another financial benefit.
That activity can create a meaningful economic impact. According to Ryan:
“States understand that the economic impact of filming in an area is like dropping an economic bomb on that city or state…"
Although policymakers continue to debate the ideal size and structure of these incentive programs, incentives remain an important factor in where many productions choose to film. As Ryan points out, almost every state that lets their program expire will later spend years trying to get it back up and running.
Film and production incentives are not simply pools of money waiting outside America’s state houses. They are highly specialized programs with eligibility rules, application deadlines, qualified-spend definitions, reporting obligations, and audit requirements.
Wrapbook’s Production Incentive Center provides current program information across the United States, but every incentive has its own benefits, limitations, and requirements. These rules can change, and frequently do.
Let’s take a look at a few of the most popular types of production incentives to help better understand how these programs work.
A refundable tax credit is one of the most common incentives offered by states. Ryan explains:
“You get dollar for dollar back what you spend in the state, aligned with whatever percentage they're going to give you back. So if the state says they'll give you back 25 percent on what you spend in New York or New Mexico for example, there are refundable credits that you would get back—if you meet the minimum criteria based on the local spend that you're doing.”
The “local spend” Ryan mentions is an important detail. Remember, these programs are designed to encourage production spending within a specific area.
Many incentives therefore require a minimum local spend and all define which cast, crew, equipment, location, vendor, and other production costs qualify for the incentive.
After the production incurs and documents its qualified spend, there are often additional filing, review, audit, or tax-return steps required before the credit is paid.
“You have to file a tax return. They [the state] offset your liability with what your production company or the person applying has in the state, which could be nothing. You're coming from out of state, so there's really nothing to offset the tax credit with. Since it's fully refundable, then they give you a check after you've done that tax return.”
Finally, it’s important to note that not all state tax credits are fully refundable. Some are only partially refundable, meaning you’ll only get back a percentage of what you spend on qualified line items.
Make sure that you know the credit rate, refundability rules, audit requirements, fees, and expected payment timeline before factoring incentive proceeds into your film financing plan.
In the case of transferable tax credits, the state doesnot issue your production a refund check. It simply offsets your in-state tax liabilities.
This might seem tricky for a production that doesn’t have a business presence in the particular state, and therefore no state tax liability to offset. How then, does the incentive money get back into the budget of production like that?
“The tax credit is transferable. You sell it. You sell it on the open market.”
On the open market, production will find other companies that have state tax liability and are therefore interested in purchasing the transferable credits to offset it.
For instance, let’s say a retail chain is planning to acquire several stores in Illinois. This will increase their tax liability in the Land of Lincoln, so they might be interested in offsetting that bill by purchasing credits from your production.
Selling a credit usually means the production receives less than its face value. Brokerage costs, transfer fees, state buyback provisions, and market conditions can further affect the net proceeds.
“You have to know what the market is selling the credits for. Are the credits currently going for 90 cents on the dollar? Eighty-five cents on the dollar? Eighty-seven cents on the dollar?”
Ryan helps Wrapbook clients evaluate the market for transferable credits, understand the variables that can affect their net value, and connect with brokers who can affect transfers.
The third and final main category of production incentives includes cash rebates and grants.
Unlike a tax credit, a rebate generally provides a direct payment after qualified expenditures have been made, reviewed, and approved. They are essentially “buckets of cash,” as Ryan puts it, that can be accessed by productions that meet certain requirements.
Oregon, for example, currently offers qualifying projects a 25% rebate on eligible Oregon goods and services, plus up to 26.2% on qualifying payroll when the applicable OPIF and Greenlight Oregon programs are combined.
Grants may follow a different schedule and are often discretionary. They can be subject to funding availability, contracting requirements, project-selection criteria, and program-specific milestones.
Keep in mind that jurisdictions will often want to make sure these rebates and grants pay dividends in terms of public relations for the area. Some grant and rebate programs like those in Texas and North Carolina evaluate applicants on a case-by-case basis to help ensure taxpayer dollars go to productions that paint the area in a positive light.
Mississippi, on the other hand, has an amazingly popular first-come, first-served rebate program. It’s important to research and understand what the requirements for each state are.
Be aware that no matter what kinds of grants or rebates you’re applying for, you’ll have to go through a vetting process before you can count on those grants or rebates to support your film.
