KRS 141.383: Refundable tax credit for motion picture or entertainment production

expenses -- Limitations -- Qualifications -- Reporting.

(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) "Below-the-line production crew" has the same meaning as in KRS 154.61 -

010;

(d) "Continuous film production" has the same meaning as in KRS 154.61-010;

(e) "Council" means the Kentucky Film Leadership Council created in KRS

154.12-282;

(f) "Loan-out entity" has the same meaning as in KRS 154.61-010;

(g) "Office" means the Kentucky Film Office created in KRS 154.12-280;

(h) "Qualifying expenditure" has the same meaning as in KRS 154.61-010;

(i) "Qualifying payroll expenditure" has the same meaning as in KRS 154.61 -

010;

(j) "Secretary" has the same meaning as in KRS 154.61-010; and

(k) "Tax incentive agreement" has the same meaning as in 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. Seventy-five million dollars ($75,000,000) for the calendar year

2022 and each calendar year thereafter;

b. Beginning with calendar year 2024, the amount in subdivision a.

of this subparagraph shall be allocated accordingly:

i. Twenty-five million dollars ($25,000,000) shall be alloca ted

for all approved companies with a continuous film

production; and

ii. On the first day of April 2025, and on April 1 of each

calendar year thereafter, 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; and

c. i. Beginning with calendar year 2026, any unallocated balance

of the amount allocated in subdivision a. of this

subparagraph for the previous calendar year shall carry

forward into the subsequent calendar year to be made

available for approved companies with high -impact motion

pictures, continuous film productions, or entertainment

productions.

ii. For purposes of this subdivision and KRS 154.61 -020 the

determination of a high -impact motion picture or

entertainment production shall be based upon criteria

established in administrative regulations promulgated under

KRS 154.61-020(4)(c).

2. To qualify for the refundable credit, all applicants shall:

a. Begin filming or production in Kentucky within one hundred

eighty (180) days of approval by the office; 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 office that the approved

company has satisfied all requirements of KRS 154.61 -020 and 154.61 -030;

and

(b) The approved company has provided a detailed cost report and sufficient

documentation to the office, which has been forwarded by the office 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 ea ch September 1 thereafter, for

the immediately preceding fiscal year, the department shall report to the office 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 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 t he 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, industrial film, vid eo game,

music video, or commercial;

2. National touring production of a Broadway show; or

3. Documentary;

(g) Whether the filming or production was performed:

1. Entirely in a heritage county; or

2. In whole or in part in any Kentucky county other than in a heritage

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 ty pe 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 Ke ntucky Revised Statutes prohibiting disclosure or

reporting of information.