Assemblyman Moriarty Bill Aimed at Incentivizing Media Production in New Jersey Clears Assembly Panel
Legislation sponsored by Assemblyman Paul Moriarty entitled the ‘Garden State Film and Digital Media Jobs Act’ cleared the Assembly Appropriations Committee on Thursday.
The bill (A-1038) provides a credit against the corporate business and gross income taxes for certain expenses incurred during the production of certain films and digital media content in New Jersey for the 2019 fiscal year up until and including the 2023 fiscal year.
After the approval of an application sent to the New Jersey Economic Development Authority and the Director of the Division of Taxation in the Department of the Treasury, taxpayers will be allowed a credit amount equal to 30 percent of the qualified film production expenses and 20 percent of the qualified digital media content production expenses. There are so many parts of our beautiful state which could be utilized for film, and so many of our residents who could contribute to these films,” said Moriarty. What this bill does is put the infrastructure in place to realize these possibilities.
If the expenses are incurred for services performed and/or personal property used or consumed in Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, Mercer, or Salem County, the allowable credit increases to 35 percent and 25 percent respectively.
In order to claim the tax credit for qualified film production expenses, the following conditions must be met:
• at least 60 percent of the total film production expenses, exclusive of post-production costs are incurred in New Jersey, or the qualified production expenses exceed $1,000,000
• the film includes marketing materials promoting the state of New Jersey in the film and include an appropriate logo at the end of the credits denoting that the piece was filmed in New Jersey
• principal photography of the film commences within 180 days from the date of the application for the tax credit, or 150 days from the approval of the application
In order to claim the tax credit for qualified digital media content production expenses, the following conditions must be met:
• at least $2,000,000 of the total digital media content production expenses are incurred in New Jersey
• at least 50 percent of the qualified digital media content production expenses are for wages and salaries paid to full-time or full-time equivalent employees in New Jersey
Both applicants for the film production and digital media content tax credits must submit a tax credit verification report prepared by an independent certified public accountant licensed in New Jersey and comply with the withholding requirements provided for payments to loan out companies and independent contractors.
There is a limit of $75 million in tax credits that may be accumulated during each year of the five-year duration of the bill for film production expenses and $10 million for qualified digital media content.