Louisiana's Film And Tv Tax Credit Program

Louisiana's film and TV tax credit program grants tax credits to movie companies up to 15 percent of production costs. The tax credits are worth a reduction in state income taxes.

This has created an explosion in movie investment in Louisiana, beginning in 2003, the first year the tax credits were available.

Louisiana'S Film And Tv Tax Credit Program has created an industry with businesses that broker movie tax credit.

"The Runaway Jury" was one film where Ted Turner bought film tax credits the state grants to movie production companies and use them to reduce his taxes. The "Runaway Jury" was about to be produced in Canada when the tax incentives lured it to New Orleans.

There is a check on the movie companies: They must certify their expenses post-production. In order to be eligible for the film credits, the film must hire Louisiana people.

The movie "Ray," was one of the first major productions to take advantage of the Louisiana'S Film And Tv Tax Credit Program. The importance of the movie is that none of it was set in Louisiana, but the bulk of it was shot in the state.

"Ray" marked the turning point in the Louisiana film industry.

About one-third of a movie's production costs go into the local economy, from purchases by the caterer to drivers to crew members. The boom is causing Baton Rouge Community College to look at adding film production classes.

The movie companies, usually California-based, normally pay far less Louisiana taxes than the credits are worth. The company is allowed to sell the excess tax credits, bought by Louisiana-based firms to reduce their taxes or to resell to individual taxpayers, usually in increments of $10,000, who then can use the credits to reduce their personal taxes.

Only higher income taxpayers, usually those with six-figure incomes,tend to buy the credits because the minimum tax credit sold is $10,000. A $10,000 tax credit purchased for $8,500 could save the taxpayer $1,500, he said.

The length you can carry a credit is a 10-year period. But its recommended you only buy it on a year-by-year basis."