Loading...

Incentives

Production Incentives Database

California Independent Project

Incentive Type Transferable Non-Refundable Tax Credit
Spend 25%
Above the Line Residents N/A
Above the Line Nonresidents N/A
Below the Line Residents 25-30%
Below the Line Nonresidents 25-30%
Bonus Local Hire Labor- Out-Of-Zone- (Does not include Post) Applies to individuals who reside in California outside the Los Angeles zone, and who perform services outside the Los Angeles zone. (two forms of residency needed) - 30 miles in radius from Beverly Boulevard and La Cienega Boulevard, Los Angeles, California, and includes Agua Dulce, Castaic, including Lake Castaic, Leo Carillo State
Beach, Ontario International Airport, Piru, and Pomona, including the Los Angeles County Fairgrounds. The Metro Goldwyn Mayer, Inc. Conejo Ranch property is within the Los Angeles zone (Bonuses can not be combined)
Project Criteria Independent films: $1 million minimum budget and 75 minutes running time (credits apply to the first $10 million of qualified expenditures);

Film at least 75% of Principal Photography days wholly in California OR 75% of the Production Budget must be incurred and used for goods, services and/or wages within California.

Diversity Tracking and Unlawful harassment Policy is required (diversity tracking is waived for independents $10M and under)

Applicants receiving a credit allocation letter(CAL) are required to make a financial contribution to fund a Pilot Career Pathways Training Program. Approved applicant’s contribution shall be 0.25%... +Read More
Loanout Registration Required No
Loanout Withholding No
Annual Funding Caps $26,400,000
Project Caps 3000000
Minimum Spend $1,000,000
Sunset Date 06/30/2025
Audit Requirements
An agreed upon procedures report by an independent California CPA is required. Only CPAs who have attended a CPA Orientation Seminar 3.0 are permitted (proof of registration)
Getting Started
California Film & Television Tax Credit Program 3.0

The application process includes:

Phase I: Eligible productions apply for tax credits.
Phase II: Applications with the highest-ranked jobs ratios submit required documentation.
Phase III: Credit Allocation Letters are issued for approved projects.
Phase IV: Projects with CALs( a received Credit Allocation Letter) enter Phase IV upon the start of principal photography, wrap, post-production, and the audit process.
Phase V: Once the audit process is completed, a “Tax Credit Certificate” is issued

Projects that rank in the top 200% will be notified to submit Phase II documents. Job Ration is determined based on a mathematical equation using qualifying wages, qualified non wage expenditures, the expected credit amount and utilizing "bonus points" Contact the Film office for further details

Productions must begin principal photography within 180 days of receipt of the CAL (Credit Allocation Letter).

Applications must be submitted online during specific allocation periods (Application Windows)

Features
(Non-Indie Feature Films: Non-Transferable
Indie Feature Films: Transferable)
January 25 – 27, 2021
Phase II: January 28 – February 1, 2021
Approval Date: March 1, 2021
5PM on the last day







Screen Credit Required
Yes
Company Registration
Yes
Sales Use Tax Relief
Yes
Hotel Occupancy Tax Relief
Yes
Local Vendors Qualify
Yes
Outside Vendors Qualify
No
Claiming Incentive
All final reports, applications, Agreed-Upon-procedures report, and Final Element Verification must be complete. FYI, Services performed no more than 30 days after the Final Element Verification date will qualify

January 1, 2020 and before January 1, 2023, Independent tax transferred credit recipients(those that purchase the credit from productions) are limited to a cap of $5M with respect to offsetting state income tax liability. This applies to projects in both Program 2.0 and Program 3.0 tax credit programs. Carry over credit for can be applied for offsetting "net tax" to the next 6 years(2.0)/ 9 Years (3.0) after issuance.
Additional Information
The maximum tax credit allowed is 30%.

*Project Cap is a base of $2.5M with the possibility of 3M if uplifts are taken into account


Allocation of funding for Independents with budgets over $10M= $10,560,000
Allocation of funding for Independents with budgets $10M and under= $15,840,000

FYI ;Background performers (extras), stand-ins and off-camera stunt
personnel do qualify.

The Qualified Expenditure Charts and Expenditure Tracking Tips are available at California Film Commission



Last updated: 07/01/2020

Production Incentive Disclaimer
The encapsulated production incentive information on this page is provided for general purposes only and should not be construed as tax advice. While we do our utmost to keep all information up to date, production incentives change often. The best source for incentive details is the film office itself. For more explanation or detail about the production incentive described here, please contact our resident production incentives expert at clientservices@mediaservices.com.