Updates to New York State Film Tax Credit Program Extend Timeline but Reduce Credit

On April 3, 2020, Governor Cuomo signed Assembly Bill 9509 and Senate Bill 7509, which amend the Empire State Film Production and Post-Production Tax Credit Programs for applications received on or after April 1, 2020. The good news, especially in light of New York’s COVID-created 10-billion-dollar revenue gap, is that the bill extends the $420 million annual film production tax credit program for an additional year (now until December 31, 2025). Unfortunately, the rest of the program’s changes are less than ideal, especially for independent filmmakers. In order to qualify for the credit, productions must now spend a minimum of $1 million if the majority of shooting is done in the five boroughs, Westchester, Rockland, Nassau or Suffolk Counties and $250,000 if the majority of shooting occurs elsewhere in the state. The only exception to these minimums is for television pilots. It is also worth mentioning is that New York’s tax credit program specifically excludes documentary films, news, current affairs programs and reality television from its definition of “qualified films,” and that exclusion remains in place in this latest amendment.

Even if a production qualifies for the program, the new bill reduces the credit from 30 percent of qualified expenses to 25 percent. Credits for qualified post-production expenses are similarly slashed from 35 percent to 30 percent if the qualified post-production facility is located within the state but outside the New York metropolitan commuter transportation district, and from 30 percent to 25 percent if the facility is located within the district. The reduction may not be ideal on an individual level, but it does mean that more productions will be able to participate.

With the world collectively tightening its belt, it is still nice to see that New York remains committed to incentivizing productions, even if at a reduced rate.

For more information about these programs, please visit the following New York State website pages:
New York State Film Tax Credit Program (Production)
New York State Film Tax Credit Program (Post-Production)

This update is intended as a general discussion of these issues only and is not to be considered legal advice or relied upon. For more information, please contact RPJ Attorney Michelle Lamardo, who counsels clients on entertainment production and intellectual property matters. Ms. Lamardo is admitted to practice law in New York. Attorney Advertising.