New Jersey’s robust Film & Digital Media Tax Credit Program, administered by the New Jersey Economic Development Authority (NJEDA), provides exceptional value and allows filmmakers to “put the money up on the screen” while staying within budget.
In 2021, the NJEDA broadened its support of film and digital media production by expanding its Film and Digital Media Tax Credit program. The program attracts production companies to film and create digital media content in New Jersey and encourages the development of large-scale studios.
New Jersey’s robust film tax credit allows filmmakers to dedicate more dollars to the finished project while staying within budget. The tax credit awarded by the NJEDA is equal to 30% to 35% of qualified film production expenses. The program will run through 2034.
Feature films, TV series, or shows of 22 minutes or more in length intended for a national audience.
Reality shows, which are otherwise ineligible for the Film Tax Credit, may be eligible if the production companies creating the reality shows own, lease, or otherwise occupies a production facility of at least 20,000 sq. ft. in an Urban Enterprise Zone for at least two years and makes a capital investment of at least $3 million in that facility.
Tax credit equal to 30 percent of qualified digital media production expenses, or 35 percent of qualified digital media production expenses incurred for services performed and tangible personal property purchased through vendors whose primary place of business is located in Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, Mercer or Salem County.
At least $2 million of the total digital media production expenses must be incurred for services performed and goods purchased through vendors authorized to do business in New Jersey and at least 50% of the qualified digital media content production expenses must be for wages and salaries paid to full-time employees in New Jersey.
In synchrony with our values, New Jersey is championing a more inclusive and diverse business model in film and TV. That’s why we’re one of the few states with a film tax credit that includes a 2% or 4% diversity bonus for plans to hire women and minorities for key creative positions and production crews.
As part of the film tax credit application, submit a diversity plan to NJEDA for approval, which should include:
Diversity plans are reviewed and approved by the NJEDA and New Jersey Office of Diversity and Inclusion.
To encourage the development of large, long-term studio facilities, two additional and separate allocation designations were created by the Economic Recovery Act of 2020, one for Studio Partners and one for Film-Lease Partners.
The applicant must be a production company that has site control of a production facility that is at least 250,000 sq. ft. for at least ten years. Additionally, prior to approval, the production facility site needs to have at least preliminary site plan approval, an executed redevelopment agreement, or an adopted redevelopment plan that contemplates the construction of the production facility and, following designation approval, be able to provide a temporary or permanent certificate of occupancy for the facility within 36 months. Only three Studio Partner designations are available, which are awarded on a first-come, first-served basis to eligible applicants.
In addition to a separate $100 million pool of incentives, the Studio Partner designation allows a production company to capture additional above-the-line salaries and wages as part of its tax credit award calculation, a key feature of the plan.
Applicants must be production companies that have at least a Letter of Intent or other site control documentation for a production facility of at least 50,000 sq. ft. for a term of at least five years. Additionally, the applicant shall commit to spending, on an annual average basis, $50 million in qualified film production expenses over the applicant’s commitment period.
Studio Partners and Film-Lease Partners would first apply to the NJEDA to be designated and then submit subsequent applications for each film project produced in New Jersey thereafter. There are no restrictions on the number of production companies that can receive the Film-Lease Partner designation.
The tax credit award percentage for Studio and Film-Lease Partners is identical to that of the legacy program for film productions, however, Studio and Film-Lease Partners benefit from a separate approval queue and separate annual allocation of $100 million for each designation category.
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