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Cameras Rolling on New Jersey Tax Credits

PEM Law Co-author(s) Avi D. Kelin, Maximilian J. Ranzato

Lights, camera, tax credits! New Jersey is rolling out the red carpet for production companies with its revamped Film and Digital Media Tax Credit Program. Designed to lure filmmakers and creators to the Garden State, this initiative offers a transferable credit against both the corporation business tax and the gross income tax for qualified expenses related to film and digital media production.

The program aims to boost New Jersey’s economy by incentivizing production companies to choose the state as their filming destination. With tax credits available up to 35% for eligible productions, it’s a win-win situation for both creators and the local economy. But that’s not all – New Jersey recently introduced two additional allocation designations to encourage the development of large, long-term studio facilities. Studio Partners and Film-Lease Partners play a crucial role in this initiative. 

Different Designations

Studio Partner:

To qualify for Studio Partner designation, production companies must demonstrate control over a production facility spanning at least 250,000 square feet for a minimum of 10 years. A Studio Partner is able to capture additional Above-the-line (ATL) wage and salary expenses in its award calculation as follows:

  • For a studio partner that incurs $15 million but less than $50 million in qualified film production expenses, they can include up to $18 million in ATL wage and salary expenses as qualified per project;
  • For a studio partner that incurs $50 million or more in qualified film production expenses, they can include up to $72 million in ATL wage and salary expenses as qualified per project;

Film-Lease Production Facility:

On the other hand, Film-Lease Production Facility designation is available to owners or developers committed to maintaining a production facility of similar size for five or more successive years. 

The owner or developer of the facility will partner with the EDA and shall accept an equity investment in the project from the EDA, at the EDA’s discretion, as a condition of approval for the Film-lease Partner Facility designation. While the owner or developer would not receive any direct incentives from New Jersey, production companies are eligible for higher awards (including increased ATL eligibility when they film at facilities with this designation.

Looking to the Future

New Jersey’s Economic Growth

New Jersey’s Film and Digital Media Tax Credit Program isn’t just about lights, cameras, and action – it’s about fostering a thriving creative ecosystem and stimulating economic growth. By offering generous tax incentives and support for studio development, the state is positioning itself as a prime destination for filmmakers and digital media creators alike. So, whether you’re a seasoned production company or a budding filmmaker, it’s time to say “hello” to New Jersey – where the credits aren’t just on screen, they’re in your pocket too.

Since the inception of the current tax-credit program, the state has witnessed remarkable growth, with production spending skyrocketing from $67 million to approximately $650 million over a span of five years. This exponential increase underscores the program’s effectiveness in attracting filmmakers and nurturing a thriving creative ecosystem within the state.

For more information about this tax credit program, please contact Avi D. Kelin, Esq. at or Max Ranzato at .

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