Action Summary of the Illinois Film Production Services Tax Credit Act as amended by SB1981 Eligibility
Commercials: $50,000 in " Illinois Production Spending"
Entertainment: $100,000 in " Illinois Production Spending"
Changed from same amounts of Illinois wages which significantly lowers the eligibility threshold particularly for commercials. Credit
The Illinois Film Production Services Tax Credit Act provides for a 30% tax credit (as of 2009) based on "Illinois Production Spending" plus an additional 15% tax credit based on Illinois labor expenditures generated by the employment of residents of geographic areas of high poverty or high unemployment.
Illinois Production Spending
"Illinois Production Spending" means the expenses incurred by the applicant for an accredited production from final script stage through post production, including, without limitation, all of the following: (1) expenses to purchase, from vendors within Illinois, tangible personal property that is used in the accredited production; (2) expenses to acquire services, from vendors in Illinois, for film production, editing, or processing; and (3) the compensation, not to exceed $100,000 for any one employee, for contractual or salaried employees who are Illinois residents performing services with respect to the accredited production.
Transfer of Credits
A transfer of this credit may be made by the taxpayer earning the credit within one year after the credit is awarded in accordance with rules adopted by the Department of Commerce and Economic Opportunity. The credit may not be carried back. If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The credit shall be applied to the earliest year for which there is a tax liability. If there are credits from more than one tax year that are available to offset a liability, the earlier credit shall be applied first. In no event shall a credit under this Section reduce the taxpayer's liability to less than zero.
Diversity
An important purpose of the Act is to promote and encourage the training and hiring of Illinois residents and utilization of vendors and service providers who represent the diversity of the Illinois population.
An applicant is required to file a diversity plan with DCEO outlining specific goals (i) for hiring minority persons and females, as defined in the Business Enterprise for Minorities, Females, and Persons with Disabilities Act, and (ii) for using vendors receiving certification under the Business Enterprise for Minorities, Females, and Persons with Disabilities Act. Upon completion of production DCEO is required to verify that an applicant has met or made good-faith efforts in achieving the diversity goals set forth in the applicant's diversity plan. Effective Dates
Applies to productions commencing on or after January 1, 2009. No sunset provision exists for this credit.
Here are the applicable links.
Link to Film Production Services Tax Credit Act (35 ILCS 15/) Here Link to Illinois Income Tax Act (35 ILCS 5/213) Scroll to Sec. 213 to access provisions related to transfer of tax credits. Here Link to SB 2030 which amends the Film Production Services Tax Credit Act (35 ILCS 15/)Here Link to SB 1981 which amends the Film Production Services Tax Credit Act (35 ILCS 15/) Here |
