{"data":{"id":"us-ky/krs-139.538","jurisdiction":"us-ky","citation":"KRS 139.538","heading":"Encouragement of motion picture industry -- Legislative purpose --","body":"Definitions -- Tax credit -- Administrative regulations.    (Effective July 15,\n2026)\n(1) It is the intent and purpose of the General Assembly in enacting this section and\nKRS 139 .990(5), to encourage the motion picture industry to choose locations in\nthe Commonwealth for the filming or producing of motion pictures, by providing\nan exemption from sales and use taxes. The exemption is accomplished by granting\na refundable credit for  sales and use taxes paid on purchases made in connection\nwith the filming or producing of motion pictures in Kentucky.\n(2) (a) On or after July 1, 2030, the department shall not accept any new applications\nas provided by subsection (4) of this section.\n(b) On or before November 1, 2026, and each November 1 thereafter as long as\nthis refundable credit is available, the department shall report to the\nLegislative Research Commission for referral to the Interim Joint Committee\non Appropriations and Revenue for all fiscal years data is available:\n1. The name and address of the motion picture company;\n2. By county, the filming location or locations in this state;\n3. A brief description of the production or productions;\n4. The amount of sales and use tax refunded to the motion picture\ncompany;\n5. The total number of motion picture companies claiming the credit; and\n6. The total amount of all sales and use tax refunded to motion picture\nproduction companies during each fiscal year reported.\n(c) The information required to be reported under this section shall not be\nconsidered confidential taxpayer information and shall n ot be subject to KRS\nChapter 131 or any other provisions of the Kentucky Revised Statutes\nprohibiting disclosure or reporting of information.\n(3) As used in this section and KRS 139.990(5):\n(a) \"Financial institution\" means any bank or savings and loan ins titution in the\nCommonwealth which carries FDIC or FSLIC insurance;\n(b) \"Motion picture production company\" means a company engaged in the\nbusiness of producing motion pictures intended for a theatrical release or for\nexhibition on national television eith er by a network or for national\nsyndication, or television programs which will serve as a pilot for or a\nsegment of a nationally televised dramatic series, either by a network or for\nnational syndication; and\n(c) \"Secretary\" means the secretary of the Kent ucky Finance and Administration\nCabinet.\n(4) Any motion picture production company that intends to film all or parts of a motion\npicture in the Commonwealth and desires to receive the credit provided for in\nsubsection (7) of this section shall, prior to the commencement of filming:\n(a) Provide the department with the address of a Kentucky location at which\nrecords of expenditures qualifying for the tax credit will be maintained, and\nwith the name of the individual maintaining these records; and\n(b) File an application for the tax credit within sixty (60) days after the\ncompletion of filming or production in Kentucky. The application shall\ninclude a final expenditure report providing documentation for expenditures\nin accordance with administrative regulations promulgated by the department.\n(5) To qualify as a basis for the financial incentive, expenditures must be made by\ncheck drawn upon any Kentucky financial institution.\n(6) The twelve (12) month period during which expenditures may qualify for the tax\ncredit shall begin on the date of the earliest expenditure reported.\n(7) Any motion picture production company which films or produces one (1) or more\nmotion pictures in the Commonwealth during any twelve (12) month period shall,\nupon making application theref or and meeting the other requirements prescribed in\nthis section, be entitled to a refundable tax credit equal to the amount of Kentucky\nsales and use tax paid for purchases made in connection with the filming or\nproduction of a motion picture.\n(8) The department shall, within sixty (60) days following the receipt of an application\nfor a credit for sales and use tax paid, calculate the total expenditures of the motion\npicture production company for which there is documentation for funds expended\nin the Comm onwealth, calculate the amount of credit to which the applicant is\nentitled, and certify the amount of the credit to the secretary. In the case of an audit,\nas provided for in subsection (13) of this section, the department shall certify the\namount of the credit due to the secretary within one hundred eighty (180) days\nfollowing the receipt of the motion picture production company's application.\n(9) Upon receipt of the certification of the amount of credit from the department, the\nsecretary shall cause the refund of sales taxes paid to be remitted to the motion\npicture production company. For purposes of payment and funding thereof, the\ncredit shall be paid in the same manner as other claims on the State Treasury are\npaid. They shall not be charged against a ny appropriation but shall be deducted\nfrom tax receipts for the current fiscal year.\n(10) The sales and use taxes paid by the motion picture production company for which a\nrefundable tax credit is granted shall be deemed not to have been legally paid into\nthe State Treasury, and the refund of the credit shall not be in violation of Section\n59 of the Kentucky Constitution.\n(11) Any tax credit or part thereof paid to a motion picture production company as a\nresult of error by the department shall be repaid by such company to the secretary.\n(12) Any tax credit or part thereof paid to a motion picture production company as a\nresult of error or fraudulent statements made by the motion picture production\ncompany shall be repaid by such company to the secretary, together with interest, at\nthe tax interest rate provided for in KRS 131.010(6).\n(13) The department may require that reported expenditures and the application for the\ntax credit from a motion picture production company be subjected to an audit by the\ndepartment auditors to verify expenditures.\n(14) For companies in the business of producing films or television shows other than\nthose which would qualify them for the credit under the definition of \"motion\npicture production company,\" the department may requir e separate accounting\nrecords for the reporting of expenditures made in connection with the application\nfor a refundable tax credit.\n(15) The department may promulgate appropriate administrative regulations to carry out\nthe intent and purposes of this section.","path":["KRS Chapter 139"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=57936","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:50:32Z","sha256":"085280ec06aa55bbd5030f238dcf288bf703f24cb6d83a2a7dcbca369fe07fd7","source_id":"us-ky","stale":false,"prev":"us-ky/krs-139.537","next":"us-ky/krs-139.5381"},"notice":"GroundRules: Original legal text. Not legal advice."}