The State of New Jersey will soon offer more than just a limited sales tax exemption on production equipment for filmmakers that choose to use New Jersey as the backdrop for their latest blockbuster. The new Governor, Phil Murphy, is expected to sign into law a new tax credit incentive program that will fundamentally change the economics of filming in New Jersey as well as the film financing structure for filmmakers. A film tax credit is a financial incentive authorized by the state for production expenses incurred from producers spending money in the local economy. The producers will receive a tax credit, based on a percentage of their qualified expenses, that they can use to finance their film. Tax credits are essential for producers as they typically fund approximately 20-40% of a film’s budget. In return, states that administer such a program receive robust economic spending, publicity, job creation, and a wide array of quantitative and qualitative benefits. New Jersey had a tax credit program, but it expired in 2015; now Governor Murphy will bring the financial incentive program back to life. Producers should expect a tax credit in the range of 20-30% of their qualified expenses, with a program cap limit of $75 million per year. Clocktower Tax Credits, LLC can assist producers in monetizing the New Jersey film tax credits by securing loans against the tax credits and brokering the transferable tax credits to one of Clocktower’s Fortune 500 corporate buyers. We are excited about this new development and look forward to helping finance many more New Jersey productions.
For more information, please contact Nathan Howe at (978) 460-4244 or NHowe@ClocktowerTC.com.