Bill Text: MN SF2455 | 2011-2012 | 87th Legislature | Introduced
Bill Title: Film production investment credit authorization
Spectrum: Moderate Partisan Bill (Republican 4-1)
Status: (Introduced - Dead) 2012-03-14 - Referred to Taxes [SF2455 Detail]
Download: Minnesota-2011-SF2455-Introduced.html
1.2relating to taxation; income; providing for a film investment credit;proposing coding for new law in Minnesota Statutes, chapter 290.1.4BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.5 Section 1. [290.0682] FILM PRODUCTION INVESTMENT CREDIT.
1.6 Subdivision 1. Credit allowed. An individual or corporate taxpayer is allowed a
1.7credit against the tax due under this chapter equal to 25 percent of the qualified investment
1.8in a qualifying film production made during the taxable year.
1.9 Subd. 2. Definitions. For the purposes of this section, the following terms have
1.10the meanings given.
1.11(a) "Qualifying film production" means a motion picture that is certified by the
1.12Minnesota Film and TV Board as made wholly in Minnesota.
1.13(b) "Qualified investment" means an amount of cash used to pay qualified production
1.14expenses that is provided by an investor who does not have any financial interest in the
1.15motion picture or the production company responsible for filming the motion picture.
1.16(c) "Motion picture" means a feature length film, whether shot on film or digital
1.17video, or a television series with a national distribution agreement, for theatrical or
1.18television viewing or as a television pilot, but does not include television coverage of
1.19news and athletic events.
1.20(d) "Qualified production expenses" means preproduction, production, and
1.21postproduction expenditures incurred in Minnesota that are directly used in a qualifying
1.22film production, including, without limitation, set construction and operation; wardrobes,
1.23make-up, accessories, and related services; costs associated with photography and sound
1.24synchronization, lighting, and related services and materials; editing and related services;
2.1rental of facilities and equipment; leasing of vehicles; costs of food and lodging; digital or
2.2tape editing, film processing, transfer of film to tape or digital format, sound mixing, and
2.3special and visual effects; total aggregate payroll; and music, if performed, composed, or
2.4recorded by a Minnesota musician or released or published by a Minnesota-domiciled
2.5and headquartered company. The following are not included: (1) postproduction costs for
2.6marketing and distribution; (2) any amounts that are later reimbursed; (3) any costs related
2.7to the transfer of credits; and (4) any amounts paid to persons or entities as a result of their
2.8participation in profits from the exploitation of the production.
2.9 Subd. 3. Certification of credits. (a) Before making a qualified investment,
2.10taxpayers must apply to the Minnesota Film and TV Board for a film production investment
2.11credit certificate. The application must be in the form and made under the procedures
2.12specified by the Minnesota Film and TV Board. The Minnesota Film and TV Board must
2.13only issue credit certificates for qualifying investments in qualifying film productions.
2.14(b) The Minnesota Film and TV Board may not issue certificates for more than
2.15$5,000,000 in film production investment credits per year.
2.16(c) By January 31 of each year, the Minnesota Film and TV Board must report to the
2.17commissioner of revenue the number, amount, and taxpayers to whom film production
2.18investment credit certificates were issued during the preceding taxable year, and must
2.19provide verification that the taxpayers issued credit certificates made the full amount of
2.20the investment required by the certificate.
2.21 Subd. 4. Carryover. The credit is limited to the liability for tax, as computed under
2.22this chapter for the taxable year. If the amount of the credit determined under this section
2.23for any taxable year exceeds this limitation, the excess is a film investment credit carryover
2.24to each of the five succeeding taxable years. The entire amount of the excess unused credit
2.25for the taxable year is carried first to the earliest of the taxable years to which the credit
2.26may be carried and then to each successive year to which the credit may be carried. The
2.27amount of the unused credit which may be added under this subdivision shall not exceed
2.28the taxpayer's liability for tax, less the film investment credit for the taxable year.
2.29 Subd. 5. Transfers. After 180 days from the date of the qualified investment,
2.30an individual or corporate taxpayer may transfer credits to another person or corporate
2.31taxpayer who is subject to tax, and must notify the commissioner of revenue within 30
2.32days of the transfer on the form prescribed by the commissioner. A person or corporate
2.33taxpayer must not transfer a credit more than once in a 12-month period. A credit acquired
2.34by transfer is subject to the limitations prescribed in this section. Any transfer of credits
2.35does not affect the time schedule for claiming the credit.
3.1EFFECTIVE DATE.This section is effective for taxable years beginning after
3.2December 31, 2011.
1.5 Section 1. [290.0682] FILM PRODUCTION INVESTMENT CREDIT.
1.6 Subdivision 1. Credit allowed. An individual or corporate taxpayer is allowed a
1.7credit against the tax due under this chapter equal to 25 percent of the qualified investment
1.8in a qualifying film production made during the taxable year.
1.9 Subd. 2. Definitions. For the purposes of this section, the following terms have
1.10the meanings given.
1.11(a) "Qualifying film production" means a motion picture that is certified by the
1.12Minnesota Film and TV Board as made wholly in Minnesota.
1.13(b) "Qualified investment" means an amount of cash used to pay qualified production
1.14expenses that is provided by an investor who does not have any financial interest in the
1.15motion picture or the production company responsible for filming the motion picture.
1.16(c) "Motion picture" means a feature length film, whether shot on film or digital
1.17video, or a television series with a national distribution agreement, for theatrical or
1.18television viewing or as a television pilot, but does not include television coverage of
1.19news and athletic events.
1.20(d) "Qualified production expenses" means preproduction, production, and
1.21postproduction expenditures incurred in Minnesota that are directly used in a qualifying
1.22film production, including, without limitation, set construction and operation; wardrobes,
1.23make-up, accessories, and related services; costs associated with photography and sound
1.24synchronization, lighting, and related services and materials; editing and related services;
2.1rental of facilities and equipment; leasing of vehicles; costs of food and lodging; digital or
2.2tape editing, film processing, transfer of film to tape or digital format, sound mixing, and
2.3special and visual effects; total aggregate payroll; and music, if performed, composed, or
2.4recorded by a Minnesota musician or released or published by a Minnesota-domiciled
2.5and headquartered company. The following are not included: (1) postproduction costs for
2.6marketing and distribution; (2) any amounts that are later reimbursed; (3) any costs related
2.7to the transfer of credits; and (4) any amounts paid to persons or entities as a result of their
2.8participation in profits from the exploitation of the production.
2.9 Subd. 3. Certification of credits. (a) Before making a qualified investment,
2.10taxpayers must apply to the Minnesota Film and TV Board for a film production investment
2.11credit certificate. The application must be in the form and made under the procedures
2.12specified by the Minnesota Film and TV Board. The Minnesota Film and TV Board must
2.13only issue credit certificates for qualifying investments in qualifying film productions.
2.14(b) The Minnesota Film and TV Board may not issue certificates for more than
2.15$5,000,000 in film production investment credits per year.
2.16(c) By January 31 of each year, the Minnesota Film and TV Board must report to the
2.17commissioner of revenue the number, amount, and taxpayers to whom film production
2.18investment credit certificates were issued during the preceding taxable year, and must
2.19provide verification that the taxpayers issued credit certificates made the full amount of
2.20the investment required by the certificate.
2.21 Subd. 4. Carryover. The credit is limited to the liability for tax, as computed under
2.22this chapter for the taxable year. If the amount of the credit determined under this section
2.23for any taxable year exceeds this limitation, the excess is a film investment credit carryover
2.24to each of the five succeeding taxable years. The entire amount of the excess unused credit
2.25for the taxable year is carried first to the earliest of the taxable years to which the credit
2.26may be carried and then to each successive year to which the credit may be carried. The
2.27amount of the unused credit which may be added under this subdivision shall not exceed
2.28the taxpayer's liability for tax, less the film investment credit for the taxable year.
2.29 Subd. 5. Transfers. After 180 days from the date of the qualified investment,
2.30an individual or corporate taxpayer may transfer credits to another person or corporate
2.31taxpayer who is subject to tax, and must notify the commissioner of revenue within 30
2.32days of the transfer on the form prescribed by the commissioner. A person or corporate
2.33taxpayer must not transfer a credit more than once in a 12-month period. A credit acquired
2.34by transfer is subject to the limitations prescribed in this section. Any transfer of credits
2.35does not affect the time schedule for claiming the credit.
3.1EFFECTIVE DATE.This section is effective for taxable years beginning after
3.2December 31, 2011.
