Film Production Infrastructure Tax Credit
Conn. Gen. Stat. §12-217kk
Conn. Gen. Stat. §12-217kk
Description and Applicable Taxes
A tax credit is available to any taxpayer that invests in a state-certified entertainment infrastructure project. This tax credit is administered by the Connecticut Department of Economic and Community Development (DECD). Any entity interested in obtaining this tax credit must apply to DECD.
This tax credit may be applied to the taxes imposed under Chapter 207 (Insurance Companies and Health Care Centers Taxes) and Chapter 208 (Corporation Business Tax) of the Connecticut General Statutes.
Infrastructure project means a capital project to provide basic buildings, facilities, or installations needed for the functioning of the digital media and motion picture industry in the state.
State-certified project means an infrastructure project undertaken in this state by an entity that:1) is in compliance with the adopted regulations; 2) is authorized to conduct business in this state; 3) is not in default on a loan made by that state or a loan guaranteed by the state, nor has ever declared bankruptcy under which an obligation of the entity to pay or repay public funds was discharged as a part of such bankruptcy; and 4) has been approved by DECD as qualifying for this tax credit.
Eligible expenditures includes all expenditures for a capital project to provide buildings, facilities, or installations, whether a capital lease or purchase, together with necessary equipment for a film, video, television, digital production facility or digital animation production facility; project development, including design, professional consulting fees and transaction costs; development, preproduction, production, post-production and distribution equipment and system access; and fixtures and other equipment.
Tax Credit Amount
The tax credit is equal to 20% for an investment of $3 million or more in a state-certified project.
Carryforward and Carryback Limitations
A taxpayer claiming this tax credit may claim all or part of the tax credit in the income year the eligible expenditures giving rise to the tax credit were incurred or in any of the three succeeding income years. The amount of tax credit earned but not claimed in an income year shall be available during the three succeeding income years after the eligible expenditures giving rise to the tax credit were incurred.
How to Apply
An entity undertaking an infrastructure project shall apply to DECD for an eligibility certificate not later than 90 days after the first expenses or cost are incurred. If DECD determines that the project is eligible to be a state-certified project, DECD shall issue a tax credit certification letter indicating the amount of the available tax credit. DECD will charge an administrative fee to review the application. Visit DECD’s website at www.ctfilm.com for more information regarding the application process.
DECD will enter the amount of the entity’s tax credit onto a tax credit voucher. No such voucher may be issued until the state-certified project is shown to be 100% complete. DECD requires an independent audit by a licensed Connecticut Certified Public Accountant of all project costs and expenditures prior to the issuance of such voucher.
Assignment and Transfer
After the initial issuance of tax credit voucher, such tax credit may be sold, assigned or otherwise transferred, in whole or in part, to one or more taxpayers, provided no tax credit, after issuance, may be sold, assigned, or otherwise transferred, in whole or in part, more than three times. In the event of an assignment, the transferor and the transferee shall jointly submit written notice of such transfer to DECD not later than 30 days after such transfer. The notification after each transfer shall include the tax credit voucher number, the date of transfer, the amount of such tax credit transferred, the tax credit balance before and after the transfer, the tax identification numbers for both the transferor and transferee, and such other information as DECD may require.
Insurance Companies and Health Care Centers: In addition to the assignments that are permitted under the specific provisions of this tax credit statute, this credit may also be assigned by an insurance company or health care center to an affiliate provided that the affiliate may only apply the assigned credit against its tax liability under Chapter 207 (Insurance Companies and Health Care Centers Taxes).
An assignee who receives the tax credit by assignment must claim the credit for an income year that the taxpayer who earned the credit would have been eligible to claim the tax credit.
How to Claim the Tax Credit
Complete Form CT-1120 FPI, Film Production Infrastructure Tax Credit, and attach it to Form CT-1120K, Business Tax Credit Summary, and/or Form CT-207K, Insurance/Health Care Tax Credit Schedule. The tax credit amount that may be claimed is the amount listed on the tax credit voucher.
Where to Get Additional Information
Direct inquiries to:
Connecticut Department of Economic and Community Development
Office of Film, Television, and Digital Media
450 Columbus Boulevard
Hartford CT 06103
Statutory and Regulatory References
Conn. Gen. Stat. §12-217kk; Conn. Agencies Regs. §§ 12-217kk-1 through 12-217kk-13.
Last updated January 25, 2017