Bill Text: IN HB1579 | 2011 | Regular Session | Introduced
Bill Title: Film and music facility tax credit.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2011-01-20 - First reading: referred to Committee on Ways and Means [HB1579 Detail]
Download: Indiana-2011-HB1579-Introduced.html
Citations Affected: IC 6-3.1-34.
Synopsis: Film and music facility tax credit. Provides an adjusted
gross income tax credit against expenditures for the construction of
certain motion picture or audio production facilities. Requires the
Indiana economic development corporation's approval of the
expenditures. Provides that the credit is equal to: (1) 10% of a
taxpayer's approved qualified expenditures for the construction of a
motion picture or audio production facility if the cost of the facility
does not exceed $1,000,000; and (2) 25% of the approved qualified
expenditures for the construction of a motion picture or audio
production facility if the cost of the facility exceeds $1,000,000.
Effective: January 1, 2012.
January 20, 2011, read first time and referred to Committee on Ways and Means.
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A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
Chapter 34. Motion Picture and Audio Production Facility Tax Credit
Sec. 1. This chapter applies to taxable years beginning after December 31, 2011.
Sec. 2. As used in this chapter, "corporation" refers to the Indiana economic development corporation.
Sec. 3. As used in this chapter, "department" refers to the department of state revenue.
Sec. 4. As used in this chapter, "motion picture or audio production" refers to a:
(1) feature length film;
(2) video;
(3) television series;
(4) commercial;
(5) music video or an audio recording; or
(6) corporate production;
made as a television pilot or to be disseminated through any combination of radio, theatrical, television, digital, or other media. The term does not include the production of a newscast or live sporting event.
Sec. 5. As used in this chapter, "pass through entity" means:
(1) a corporation that is exempt from the adjusted gross income tax under IC 6-3-2-2.8(2);
(2) a partnership;
(3) a limited liability company; or
(4) a limited liability partnership.
Sec. 6. As used in this chapter, "production facility" means a building or complex of buildings, including fixtures, improvements, and back lot facilities, that:
(1) contains at least one (1) sound stage or recording studio; and
(2) is used for the sole purpose of making a motion picture or audio production.
Sec. 7. (a) As used in this chapter, "qualified expenditures" means the total amount of expenditures that are:
(1) made by a taxpayer for the construction of a motion picture or audio production facility to be used and occupied by the taxpayer; and
(2) approved by the corporation for purposes of this chapter.
(b) The term does not include costs that are incurred to do the following:
(1) Acquire a property or an interest in a property.
(2) Pay taxes due on a property.
(3) Pay realtors' fees associated with a structure or property.
(4) Pay paving and landscaping costs.
(5) Pay sales and marketing costs.
Sec. 8. As used in this chapter, "state tax liability" means a taxpayer's total tax liability incurred under IC 6-3-1 through IC 6-3-7 (the adjusted gross income tax) as computed after the application of all credits that under IC 6-3.1-1-2 are to be applied before the credit provided by this chapter.
Sec. 9. As used in this chapter, "taxpayer" means an individual or entity that has any state tax liability.
Sec. 10. (a) Subject to section 13 of this chapter, a taxpayer is entitled to a credit against the taxpayer's state tax liability in the taxable year in which the taxpayer completes the construction of
a motion picture or audio production facility and obtains the
certification required under section 11 of this chapter.
(b) The amount of a credit allowed under this chapter is
determined as follows:
(1) If the taxpayer's qualified expenditures do not exceed one
million dollars ($1,000,000), the amount of the credit is equal
to ten percent (10%) of the taxpayer's qualified expenditures.
(2) If the taxpayer's qualified expenditures exceed one million
dollars ($1,000,000), the amount of the credit is equal to
twenty-five percent (25%) of the taxpayer's qualified
expenditures.
Sec. 11. A taxpayer qualifies for a credit under section 10 of this
chapter if the corporation certifies that all the following conditions
are met:
(1) The motion picture or audio production facility is:
(A) located in Indiana; and
(B) owned by the taxpayer.
(2) The property is principally used and occupied by the
taxpayer as the taxpayer's film or music production facility.
(3) The qualified expenditures for the construction of the
motion picture or audio production facility exceed:
(A) one hundred thousand dollars ($100,000) for the
construction of an audio production facility; or
(B) three hundred fifty thousand dollars ($350,000) for the
construction of a motion picture production facility.
Sec. 12. To obtain a credit under this chapter, a taxpayer must
claim the credit on the taxpayer's annual state tax return or
returns in the manner prescribed by the department of state
revenue. The taxpayer shall submit to the department of state
revenue the certification by the corporation required under section
11 of this chapter and all information that the department of state
revenue determines is necessary for the calculation of the credit
provided by this chapter.
Sec. 13. (a) If the credit provided by this chapter exceeds a
taxpayer's state tax liability for the taxable year for which the
credit is first claimed, the excess may be carried over to succeeding
taxable years and used as a credit against the tax otherwise due
and payable by the taxpayer under IC 6-3 during those taxable
years. Each time the credit is carried over to a succeeding taxable
year, the credit is to be reduced by the amount used as a credit
during the immediately preceding taxable year. The credit
provided by this chapter may be carried forward and applied to
succeeding taxable years for five (5) taxable years following the
unused credit year.
(b) A credit earned by a taxpayer in a particular taxable year
shall be applied against the taxpayer's tax liability for that taxable
year before any credit carryover is applied against that liability
under subsection (a).
(c) A taxpayer is not entitled to any carryback or refund of any
unused credit.
Sec. 14. If a pass through entity is entitled to a tax credit under
this chapter but does not have state tax liability against which the
tax credit may be applied, a shareholder, partner, or member of
the pass through entity is entitled to a tax credit equal to:
(1) the tax credit determined for the pass through entity for
the taxable year; multiplied by
(2) the percentage of the pass through entity's distributive
income to which the shareholder, partner, or member is
entitled.
Sec. 15. A taxpayer may not sell, assign, convey, or otherwise
transfer a tax credit provided under this chapter.
