Kentucky Statutes 141.383 – Refundable tax credit for motion picture or entertainment production expenses — Reporting
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(1) As used in this section:
(a) “Above-the-line production crew” has the same meaning as in KRS § 154.61-
010;
(b) “Approved company” has the same meaning as in KRS § 154.61-010; (c) “Authority” has the same meaning as in KRS § 154.61-010;
(d) “Below-the-line production crew” has the same meaning as in KRS § 154.61-
010;
(e) “Continuous film production” has the same meaning as in KRS § 154.61-010; (f) “Loan-out entity” has the same meaning as in KRS § 154.61-010;
(g) “Qualifying expenditure” has the same meaning as in KRS § 154.61-010;
(h) “Qualifying payroll expenditure” has the same meaning as in KRS § 154.61-
010;
(i) “Secretary” has the same meaning as in KRS § 154.61-010; and
(j) “Tax incentive agreement” has the same meaning as KRS § 154.61-010.
(2) (a) There is hereby created a tax credit against the tax imposed under KRS
141.020 or 141.040 and 141.0401, with the ordering of credits as provided in
KRS § 141.0205.
(b) The incentive available under paragraph (a) of this section is:
1. A refundable credit for applications approved prior to April 27, 2018;
2. A nonrefundable and nontransferable credit for applications approved on or after April 27, 2018, but before January 1, 2022; and
3. A refundable credit for applications approved on or after January 1,
2022, if the provisions of paragraph (c) of this subsection are met.
(c) 1. The total tax incentive approved under KRS § 154.61-020 shall be limited to:
a. One hundred million dollars ($100,000,000) for calendar year
2018 and each calendar year through the calendar year 2021;
b. Seventy-five million dollars ($75,000,000) for the calendar year
2022 and each calendar year thereafter; and
c. Beginning with calendar year 2024, the amount in subdivision b. of this subparagraph shall be allocated accordingly:
i. Twenty-five million dollars ($25,000,000) shall be allocated for all approved companies with a continuous film production; and
ii. On the first day of July of each calendar year, any unused balance allocated under subpart i. of this subdivision for continuous film productions shall be made available for all approved companies with a motion picture or entertainment production.
2. To qualify for the refundable credit, all applicants shall:
a. Begin filming or production in Kentucky within six (6) months of approval by the authority; and
b. Complete filming or production in Kentucky within two (2) years of their production start date.
(3) An approved company may receive a refundable tax credit if:
(a) The department has received notification from the authority that the approved company has satisfied all requirements of KRS § 154.61-020 and KRS § 154.61-030; and
(b) The approved company has provided a detailed cost report and sufficient documentation to the authority, which has been forwarded by the authority to the department, that:
1. The purchases of qualifying expenditures were made after the execution of the tax incentive agreement; and
2. The approved company or loan-out entity has withheld income tax as required by KRS § 141.310 on all qualified payroll expenditures, and remitted and certified the withheld amount to the department.
(4) Interest shall not be allowed or paid on any refundable credits provided under this section.
(5) The department may promulgate administrative regulations under KRS Chapter
13A to administer this section.
(6) On or before September 1, 2010, and on or before each September 1 thereafter, for the immediately preceding fiscal year, the department shall report to the authority and the Interim Joint Committee on Appropriations and Revenue the names of the approved companies and the amounts of refundable income tax credit claimed.
(7) No later than September 1, 2021, and by November 1 every four (4) years thereafter, the department and the Cabinet for Economic Development shall cooperatively provide historical data related to the tax credit allowed in this section and KRS § 154.61-020 and KRS § 154.61-030, including data items beginning with tax credits claimed for taxable years beginning on or after January 1, 2018:
(a) The name of the taxpayer claiming the tax credit;
(b) The date that the application was approved and the date the filming or production was completed;
(c) The taxable year in which the taxpayer claimed the tax credit;
(d) The total amount of the tax credit, including any amount denied, any amount applied against a tax liability, any amount refunded, and any amount remaining that may be claimed on a return filed in the future;
(e) Whether the taxpayer is a Kentucky-based company as defined in KRS
154.61-010;
(f) Whether the taxpayer films or produces a:
1. Feature-length film, television program, or industrial film;
2. National touring production of a Broadway show; or
3. Documentary;
(g) Whether the filming or production was performed:
1. Entirely in an enhanced county; or
2. In whole or in part in any Kentucky county other than in an enhanced incentive county;
(h) The amount of qualifying expenditures incurred by the taxpayer; (i) The amount of qualifying payroll expenditures paid to:
1. Resident below-the-line crew; and
2. Nonresident below-the-line production crew;
including the number of crew members in each category; (j) The amount of qualifying payroll expenditures paid to:
1. Resident above-the-line crew; and
2. Nonresident above-the-line crew;
including the number of crew members in each category; and
(k) A brief description of the type of motion picture or entertainment production project.
(8) The information required to be reported under this section shall not be considered confidential taxpayer information and shall not be subject to KRS Chapter 131 or any other provisions of the Kentucky Revised Statutes prohibiting disclosure or reporting of information.
Effective: June 29, 2023
History: Amended 2023 Ky. Acts ch. 75, sec. 5, effective June 29, 2023. — Amended
2021 Ky. Acts ch. 156, sec. 16, effective June 29, 2021. — Amended 2020 Ky. Acts ch. 91, sec. 15, effective April 15, 2020. — Amended 2018 Ky. Acts ch. 171, sec. 85, effective April 14, 2018; and ch. 207, sec. 85, effective April 27, 2018. — Amended
2014 Ky. Acts ch. 102, sec. 13, effective July 15, 2014. — Created 2009 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 47, effective June 26, 2009.
Legislative Research Commission Note (4/15/2020). 2020 Ky. Acts ch. 91, sec. 76 provides that the changes made to this statute in Section 15 of that Act apply to taxable years beginning on or after January 1, 2019.
(a) “Above-the-line production crew” has the same meaning as in KRS § 154.61-
Terms Used In Kentucky Statutes 141.383
- Company: may extend and be applied to any corporation, company, person, partnership, joint stock company, or association. See Kentucky Statutes 446.010
- Department: means the Department of Revenue. See Kentucky Statutes 141.010
- Joint committee: Committees including membership from both houses of teh legislature. Joint committees are usually established with narrow jurisdictions and normally lack authority to report legislation.
- Nonresident: means any individual not a resident of this state. See Kentucky Statutes 141.010
- Resident: means an individual domiciled within this state or an individual who is not domiciled in this state, but maintains a place of abode in this state and spends in the aggregate more than one hundred eighty-three (183) days of the taxable year in this state. See Kentucky Statutes 141.010
- Statute: A law passed by a legislature.
- Taxable year: means the calendar year or fiscal year ending during such calendar year, upon the basis of which net income is computed, and in the case of a return made for a fractional part of a year under the provisions of this chapter or under administrative regulations prescribed by the commissioner, "taxable year" means the period for which the return is made. See Kentucky Statutes 141.010
- Year: means calendar year. See Kentucky Statutes 446.010
010;
(b) “Approved company” has the same meaning as in KRS § 154.61-010; (c) “Authority” has the same meaning as in KRS § 154.61-010;
(d) “Below-the-line production crew” has the same meaning as in KRS § 154.61-
010;
(e) “Continuous film production” has the same meaning as in KRS § 154.61-010; (f) “Loan-out entity” has the same meaning as in KRS § 154.61-010;
(g) “Qualifying expenditure” has the same meaning as in KRS § 154.61-010;
(h) “Qualifying payroll expenditure” has the same meaning as in KRS § 154.61-
010;
(i) “Secretary” has the same meaning as in KRS § 154.61-010; and
(j) “Tax incentive agreement” has the same meaning as KRS § 154.61-010.
(2) (a) There is hereby created a tax credit against the tax imposed under KRS
141.020 or 141.040 and 141.0401, with the ordering of credits as provided in
KRS § 141.0205.
(b) The incentive available under paragraph (a) of this section is:
1. A refundable credit for applications approved prior to April 27, 2018;
2. A nonrefundable and nontransferable credit for applications approved on or after April 27, 2018, but before January 1, 2022; and
3. A refundable credit for applications approved on or after January 1,
2022, if the provisions of paragraph (c) of this subsection are met.
(c) 1. The total tax incentive approved under KRS § 154.61-020 shall be limited to:
a. One hundred million dollars ($100,000,000) for calendar year
2018 and each calendar year through the calendar year 2021;
b. Seventy-five million dollars ($75,000,000) for the calendar year
2022 and each calendar year thereafter; and
c. Beginning with calendar year 2024, the amount in subdivision b. of this subparagraph shall be allocated accordingly:
i. Twenty-five million dollars ($25,000,000) shall be allocated for all approved companies with a continuous film production; and
ii. On the first day of July of each calendar year, any unused balance allocated under subpart i. of this subdivision for continuous film productions shall be made available for all approved companies with a motion picture or entertainment production.
2. To qualify for the refundable credit, all applicants shall:
a. Begin filming or production in Kentucky within six (6) months of approval by the authority; and
b. Complete filming or production in Kentucky within two (2) years of their production start date.
(3) An approved company may receive a refundable tax credit if:
(a) The department has received notification from the authority that the approved company has satisfied all requirements of KRS § 154.61-020 and KRS § 154.61-030; and
(b) The approved company has provided a detailed cost report and sufficient documentation to the authority, which has been forwarded by the authority to the department, that:
1. The purchases of qualifying expenditures were made after the execution of the tax incentive agreement; and
2. The approved company or loan-out entity has withheld income tax as required by KRS § 141.310 on all qualified payroll expenditures, and remitted and certified the withheld amount to the department.
(4) Interest shall not be allowed or paid on any refundable credits provided under this section.
(5) The department may promulgate administrative regulations under KRS Chapter
13A to administer this section.
(6) On or before September 1, 2010, and on or before each September 1 thereafter, for the immediately preceding fiscal year, the department shall report to the authority and the Interim Joint Committee on Appropriations and Revenue the names of the approved companies and the amounts of refundable income tax credit claimed.
(7) No later than September 1, 2021, and by November 1 every four (4) years thereafter, the department and the Cabinet for Economic Development shall cooperatively provide historical data related to the tax credit allowed in this section and KRS § 154.61-020 and KRS § 154.61-030, including data items beginning with tax credits claimed for taxable years beginning on or after January 1, 2018:
(a) The name of the taxpayer claiming the tax credit;
(b) The date that the application was approved and the date the filming or production was completed;
(c) The taxable year in which the taxpayer claimed the tax credit;
(d) The total amount of the tax credit, including any amount denied, any amount applied against a tax liability, any amount refunded, and any amount remaining that may be claimed on a return filed in the future;
(e) Whether the taxpayer is a Kentucky-based company as defined in KRS
154.61-010;
(f) Whether the taxpayer films or produces a:
1. Feature-length film, television program, or industrial film;
2. National touring production of a Broadway show; or
3. Documentary;
(g) Whether the filming or production was performed:
1. Entirely in an enhanced county; or
2. In whole or in part in any Kentucky county other than in an enhanced incentive county;
(h) The amount of qualifying expenditures incurred by the taxpayer; (i) The amount of qualifying payroll expenditures paid to:
1. Resident below-the-line crew; and
2. Nonresident below-the-line production crew;
including the number of crew members in each category; (j) The amount of qualifying payroll expenditures paid to:
1. Resident above-the-line crew; and
2. Nonresident above-the-line crew;
including the number of crew members in each category; and
(k) A brief description of the type of motion picture or entertainment production project.
(8) The information required to be reported under this section shall not be considered confidential taxpayer information and shall not be subject to KRS Chapter 131 or any other provisions of the Kentucky Revised Statutes prohibiting disclosure or reporting of information.
Effective: June 29, 2023
History: Amended 2023 Ky. Acts ch. 75, sec. 5, effective June 29, 2023. — Amended
2021 Ky. Acts ch. 156, sec. 16, effective June 29, 2021. — Amended 2020 Ky. Acts ch. 91, sec. 15, effective April 15, 2020. — Amended 2018 Ky. Acts ch. 171, sec. 85, effective April 14, 2018; and ch. 207, sec. 85, effective April 27, 2018. — Amended
2014 Ky. Acts ch. 102, sec. 13, effective July 15, 2014. — Created 2009 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 47, effective June 26, 2009.
Legislative Research Commission Note (4/15/2020). 2020 Ky. Acts ch. 91, sec. 76 provides that the changes made to this statute in Section 15 of that Act apply to taxable years beginning on or after January 1, 2019.