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Film Producers Can Earn Tax Credit in Pennsylvania
PHILADELPHIA -- Film producers who come to Pennsylvania may be eligible for a 20% tax credit for their expenses now that Gov. Edward G. Rendell has signed legislation to that effect into law."Filmmakers continue to discover that Pennsylvania is an ideal location for film production," Rendell said after signing House Bill 147 at the Prince Theater here. "With widely diverse locales and innovative benefits, Pennsylvania is dedicated to helping filmmakers make their projects a reality."In 2003, filmmakers and their projects injected more than $107 million into Pennsylvania's economy. Small and large businesses, hotels and restaurants all benefit from the jobs, workers and tourists that filmmaking can attract.The tax credit is available for feature films, television series and television shows of 15 minutes or more in length intended for a national audience. Of total production expenses, 60%must be incurred in Pennsylvania.Production expenses eligible for the credit include wages and salaries, construction, operations, editing, photography, sound synchronization, lighting, wardrobe and accessories and the cost of rental of facilities and equipment. The credit cannot be applied to marketing and advertising costs.Taxpayers who incur a qualified expense must submit an application for a film production tax credit to the Pennsylvania Department of Revenue by Feb. 15 of the calendar year following the close of the tax year in which the expense is incurred. The Revenue Department will notify that taxpayer of the amount of the approved tax credit by Aug. 15 of the year it is submitted.If the taxpayer cannot use the entire amount of the approved tax credit for the tax year in which it was approved, the excess may be carried over for three succeeding tax years and used as a credit against the qualified tax liability of the taxpayer. In addition, upon approval by the state Department of Community and Economic Development, a taxpayer may sell or assign, in whole or in part, a film production tax credit."The crucial carryover component will allow Pennsylvania's budding filmmakers who may not yet have a tax liability to sell or assign their unused credits for cash to qualified taxpayers," Rendell says. "The increased cash flow will allow the developing filmmakers to continue or even increase their film production workflow."The Department of Revenue and the Pennsylvania Film Office will jointly administer the Film Production Tax Credit. "