Picture state tax credit in your future

Sandra Bullock in "The Blind Side"

by Henry Unger
 
Sandra Bullock may have a state tax credit waiting for you. Seriously.

There is at least $40 million in unclaimed tax credits from film companies shooting in Georgia that you or a corporation can use to reduce state taxes.

Part of those tax credits are from “The Blind Side,” which was filmed around Atlanta and starred Bullock.  The credits can be used to reduce a company’s 2009 state tax liability, which is due to be filed March 15. They also can be used to cut individual state taxes, due April 15.  There is still enough time to get the paperwork done, officials said.  We’re talking taxes here, so it’s a little complicated to explain. Bear with me.

Bill Thompson

Here are the basics, which I got by interviewing Bill Thompson, head of Georgia’s Film, Music & Digital Entertainment division, and Denise Elsbree, a partner in Georgia Film Credit Consultants:

To prop up the state’s film industry, legislators passed a special tax credit in 2008 for entertainment companies (film, TV, music video and video games) to do their production work in Georgia.
The credit is primarily responsible for production skyrocketing in the state to $770 million in 2009, from $295 million in 2008, Thompson and Elsbree said. About 7,500 workers are employed in the industry.
The entertainment production companies, which can get a 30 percent tax credit for their spending here, cannot take full advantage of the incentive by themselves. That’s because their state tax liability is generally far lower than the credit is worth.

That’s where you or a company can come in. To enjoy more of the tax credit, the film companies need to share them with a third party, which is allowed by the legislation.

Denise Elsbree

For example, a film company that spends $100 million would be eligible for a $30 million state credit. But its tax liability might only be $6 million, leaving $24 million on the table.

To avoid that, the company is willing to give up 10 percent to 15 percent of that $24 million, so it can get the remainder of the credit. In this case, you or another company would get a tax credit of between $2.4 million and $3.6 million.
The larger film producers generally want to deal with corporations with sizable state tax liabilities. But the smaller film companies are willing to deal with individuals, possibly those who owe as little as $10,000 in state taxes.


By the way, the credits are good for five years, but they cannot be transferred again.

There has not been much marketing or publicity about this credit because Thompson and other state officials have been spending most of their time trying to attract film companies to produce here.  But the word needs to get out, officials said, so the companies are able to take full advantage of the credit or they can decide to move to other states where they can. Some 40 states offer incentives to attract these companies.

For more details, you can go to the gacredits.com Web site or call the state’s Economic Development Department at 404-962-4052.

Now that I’ve shilled for Bullock’s film, do you think I can get her autograph?