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What is Soft Money?

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The reason this is called soft money, is because you’re not actually getting financing for your film. Soft money is a way to reduce your budget with tax credits, incentives, subsidies, rebates, etc from the local government. When you film in certain countries or states, the local film commission will subsidize a set percentage of your budget because you are essentially providing jobs for local workers. Every film commission has their own website you can visit to see what incentives they have to offer. It’s not uncommon to see large productions being filmed outside of Hollywood as they can literally save millions of dollars in doing so. Below is a summary of some of the incentives from certain states and provinces.

Louisiana 

  • 30% tax credit on qualified direct production Louisiana expenditures
  • Additional 5% tax credit for payroll expenditures to Louisiana residents
  • No annual cap
  • Tax credits may be used to offset income tax liability in Louisiana (corporate or personal), sold back to the State for 85% face value, or brokered on the open market.
 
Georgia
  • 20% across the board, transferable flat tax credit with a minimum of $500,000 spent on qualified production and post production expenditures within Georgia
  • Additional 10% tax credit if a production company includes an imbedded Georgia promotional logo in the qualified feature film, TV series, music video or video game project
  • Provides same tax credits to all instate and out-of-state labor working in Georgia, plus standard fringes qualify
  • No limits or caps on Georgia spend; no sunset clause
  • If production company has little or no Georgia tax liability, it can transfer or sell its tax credits.
 
Michigan
  • 27% of direct Michigan expenditures.
  • Claim an extra 3% for expenditures at a qualified facility or post production facility.
  • Michigan Personnel 32%
  • Crew Personnel Expenditures 20%
  • Qualified Personnel Expenditures 27%
  • Caps: Payments for MI producers shall not exceed 10% of expenditures, 5% for non-MI producers
  • $2 million qualifying salary cap per employee per production.
 
Pennsylvania
  • 25% Tax Credit to films that spend at least 60% of their total production budget in the Commonwealth.
  • Credit applies to all production (including pre- and post-production) expenses incurred in Pennsylvania,
  • There is a cap of $15 million in aggregate payments for “above the line” services to be provided by principal actors, whether directly or through a “loan-out” company.
 
British Columbia, Canada
  • 33% tax credit for qualified BC labour expenditures
  • At least 75% of the total cost* of the production (or the British Columbia portion of the production, in the case of a treaty or interprovincial co-production) must be for goods or services provided in British Columbia by BC based individuals or proprietorships, partnerships or corporations that operate a business through a permanent establishment in British Columbia
  • At least 75% of the cost* of post-production work must be for work carried out in British Columbia. This requirement does not apply to treaty or inter-provincial co-productions.
 
Ontario, Canada
  • 25% refundable tax credit on Ontario production expenditures
  • The federal government also offers an additional tax credit of 16% for eligible labour on service productions.
  • 25% on your eligible Ontario spend including all post-production
  • 20% additional for eligible labour on VFX and green screen work that stacks on top of the other credits.
 
Puerto Rico
  • 40% production tax credit on all payments to Puerto Rico resident companies and individuals
  • 20% production tax credit on all Nonresident Qualified spending
  • No per project or individual wage caps
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