By Jeff Glickman, Aprio, LLP, Partner-in-Charge of State & Local Tax (SALT) Services
Georgia Policy Bulletin IT 2016-01 changes the treatment of interim production expenditures for purposes of the film tax credit, effective January 1, 2017. Interim production expenditures are costs incurred between seasons of a television or other series, and include expenses for holding studios and maintaining sets. Prior to January 1, 2017, interim production expenditures qualified for the film tax credit and can be claimed in the year the expenses are incurred.
However, effective on or after January 1, 2017, interim production expenditures qualify for the film tax credit subject to the following two conditions/limitations: (1) the subsequent season is filmed in Georgia and (2) the expenditures can be claimed only in the taxable year in which the subsequent season begins, even if those expenditures were incurred in the prior taxable year.
For example, assume season 1 of a television series finishes filming in Georgia in June 30, 2017, and the second season begins filming in Georgia in February 1, 2018. Any interim production expenditures incurred from July 1-December 31, 2017 may be included in the calculation of the production company’s film tax credit for the 2018 tax year (not the 2017 tax year). If the second season had not been filmed in Georgia, those interim production expenditures would not have qualified for the film tax credit.
Aprio’s SALT team has extensive experience assisting production companies with the Georgia film tax credit and ensuring that those companies maximize the amount of the credit to which they are entitled.
If you would like to learn more about how Aprio’s SALT team can assist you, please contact Jeff Glickman at [email protected] or at 770-353-4791.
Prior to joining Aprio, Jeff was an attorney with the SALT group of Alston & Bird LLP in Atlanta. Jeff received his LL.M. in Taxation in 1999 and his J.D. in 1998 from New York University School of Law, and he received his B.S., with distinction, from Cornell University in 1995. He is a member of the Taxation Sections of the American Bar Association, State Bar of Georgia and Atlanta Bar Association.