INCENTIVES & TAX CREDITS
IMPORTANT NOTICE TO ALL TAX CREDIT APPLICANTS AND CLAIMANTS:
Please read through the new Temporary Hawaii Administrative Rules on this page under Overview and Instructions.
Governor David Ige recently signed into law Act 143 which does not take effect util December 31, 2018 but which extends the sunset date for the tax credit program to January 1, 2026.
20-25% MOTION PICTURE, DIGITAL MEDIA, & FILM PRODUCTION INCOME TAX CREDIT
This is a refundable tax credit based on a production company’s Hawaii expenditures while producing a qualified film, television, commercial, or digital media project. The credit equals 20% of qualified production costs incurred on Oahu, and 25% on the neighbor islands (Big Island, Kauai, Lanai, Maui, Molokai).
- Register with the Hawaii Film Office/Department of Business, Economic Development & Tourism at least five business days PRIOR to the first Hawaii shoot date;
- Meet the minimum in-state spending requirement of at least $200,000;
- Make reasonable efforts to hire local talent and crew; and,
- Provide evidence of financial or in-kind contributions or educational or workforce development efforts toward the furtherance of the local film, television and digital media industries that is valued at 0.1% of the productions Hawaii Spend or $1000, whichever is greater.
The refundable production tax credit also includes the following:
• Per production credit cap of $15 million;
• Qualifies certain productions with Internet-only distribution;
• Allows State and County location and facilities fees as a qualified expenditure;
Overview & Instructions:
- Instructions-20-25% Credit-UPDATED-11-24-2017
- FAQs About the 20-25% Tax Credit (.pdf)- Frequently asked questions about the credit, including what is eligible as a “qualified production cost”
- NEW Tax Information Release (TIR) No. 2018-04 – TABLE OF CONTENTS for TIR 2018-04
- 2017 Tax Advisory *NEW TAX ADVISORY – November 2, 2017 – (Effective Immediately, please use this updated advisory rather than the sample tax advisory in TIR No. 2009-05).
- Tax Information Release No. 2006-02 (.pdf) – Additional guidelines and examples on what is eligible as a “qualified production cost”
- Tax Information Release No. 2009-05 (.pdf)- Regarding administrative rules relating to film related tax credits
- Tax Information Release No. 2010-04 (.pdf)- Most recent TIR regarding the interpretation of the term “qualified production” for purposes of administering the refundable Motion Picture, Digital Media, and Film Production Income Tax Credit
- Statute: NEW Act 143 (in effect January 1, 2019) Hawaii Revised Statutes §235-17 (Governor’s message 1244)
- PRODUCTION REGISTRATION FORM FOR 20-25% TAX CREDIT (fillable .pdf) – Due at least one week prior to first Hawaii shoot date.
- HAWAII PRODUCTION REPORT FOR 20-25% TAX CREDIT (fillable .pdf) – Due no later than 90 days following the end of each taxable year in which qualified production costs were expended.
- SPLIT YEAR PRODUCTION REGISTRATION FORM(fillable .pdf)
Required Attachments for the Hawaii Production Report:
- Detailed final Hawaii Expenditure Report
- Vendor list with total costs associated with each vendor or individual with current general excise tax (GET) license numbers for all vendors.
- Verification of Education/Workforce Development Contribution
- Third-party verification review of your claim for this tax credit by a qualified tax professional or CPA using procedures prescribed by DBEDT submitted with the statement of qualified production costs.
- Crew list with names and contact info.
Budget/Expenditure Report Templates:
These templates provide an example of the level of detail required on the Hawaii expenditure reports you need to submit with your Hawaii Production Report. All cost items, other than petty cash, must be associated with a specific vendor or individual’s name and a General Excise Tax (GET) License number. Total costs paid to each vendor or individual must be included in required Vendor List form. Please use the Vendor List Template below. You may use your own budget/expenditure report formats as long as the detail provided is equivalent to the detail found in these templates.
Please note the multiple worksheets on different tabs in each document.
- VENDOR LIST TEMPLATE (.xlsx)
ROYALTIES TAX EXEMPTION
Royalties derived from performing arts products are excluded from a Hawaii taxpayer’s income and not subject to state income tax.
Overview & Instructions:
For further information, contact: