Ohio Film Tax Credit: A Comprehensive Guide for Filmmakers

The Ohio Motion Picture Tax Credit (OMPTC) has become a vital tool for filmmakers looking to make their mark in one of the most promising emerging film production hubs in the United States. With its competitive financial incentives and state-of-the-art facilities, Ohio is quickly becoming a go-to destination for film, television, and digital media production. This comprehensive guide aims to provide a detailed look at the Ohio Film Tax Credit, including its benefits, eligibility, application process, and much more.

What is the Ohio Film Tax Credit?

The Ohio Motion Picture Tax Credit (OMPTC) is a refundable tax incentive designed to encourage media productions to film and produce in Ohio. The incentive offers filmmakers the opportunity to receive a tax credit for a portion of the eligible in-state production expenditures (EPEs) they incur. The credit helps offset production costs by reimbursing filmmakers for qualified expenditures such as cast and crew wages, production costs, and other on-location expenses in Ohio.

The Ohio Film Tax Credit is one of the most effective tools in Ohio’s strategy to attract film, television, and digital media productions, contributing significantly to job creation, economic stimulation, and tourism in the state. The program is designed to make Ohio a competitive destination for the film industry, while also supporting local businesses and communities.

Key Features of the Ohio Motion Picture Tax Credit

Refundable Tax Credit

One of the main benefits of the Ohio Film Tax Credit is that it is a refundable tax credit. This means that if the tax credit exceeds a production company's state tax liability, the difference is refunded as a cash payment. This feature is highly beneficial for out-of-state filmmakers who may not have a large Ohio tax liability but still want to benefit from the incentive.

Credit Rate

The OMPTC offers two types of credit rates:

30% Tax Credit: This is available on eligible production expenditures (EPEs) related to cast and crew wages.
25% Tax Credit: This is available on all other qualifying in-state expenditures such as set construction, equipment rentals, and location fees.

Minimum Spend Requirement

To qualify for the tax credit, a project must incur at least $300,000 in eligible production expenditures within Ohio. This requirement ensures that productions are making a significant financial impact on the state’s economy, stimulating local businesses, and creating jobs in the community.

Annual Funding Cap

The Ohio Film Tax Credit program is subject to an annual funding cap of $50 million. The state allocates the funds through two application rounds each year. Once the cap is reached for the fiscal year, the program is closed until the next round. This funding structure means that competition for tax credits can be intense, so early application is advisable for interested filmmakers.

Eligibility for the Ohio Film Tax Credit

The Ohio Film Tax Credit is designed to support a broad spectrum of media productions, from independent films to large-scale television series and video games. However, to qualify for the program, productions must meet several criteria:

Eligible Productions

The OMPTC supports a variety of media projects, including:

Feature Films: Both large studio projects and independent films.
Television Series and Miniseries: Projects intended for broadcast or streaming platforms.
Documentaries: Educational, historical, or other types of documentary films.
Video Games and Interactive Media: Digital productions and games.
Music Videos: Productions created to support music artists.
Commercials: Projects created for advertising purposes.
Pre-Broadway Theatrical Productions: The OMPTC also applies to certain theater productions, especially those seeking a tryout period before heading to Broadway.

Excluded Productions

Certain productions are not eligible for the Ohio Film Tax Credit, including:

Television News, Weather, and Sports: These are excluded because they do not contribute to Ohio's film industry in the same way.
Market Reports or Political Campaign Ads: These are also not eligible for the credit.

How to Apply for the Ohio Film Tax Credit

The application process for the Ohio Film Tax Credit involves several steps, and it is crucial for production companies to understand and follow these steps to ensure they qualify for the incentive.

Step 1: Pre-Application Approval

Before any production begins, filmmakers must submit a Pre-Application to the Ohio Development Services Agency (ODSA) to receive approval for the tax credit. This pre-application is a high-level overview of the production, its estimated expenditures, and its planned filming activities within Ohio. It should include:

A detailed description of the project.
A list of expected locations in Ohio.
Estimated total in-state expenditures (including cast and crew wages, facility rentals, etc.).
The anticipated filming schedule.

Once the ODSA approves the pre-application, the production company will be eligible to proceed with filming in Ohio and begin incurring eligible production expenses.

Step 2: Submit Documentation During Production

As the production progresses, filmmakers must keep accurate records of all eligible expenses. This documentation will be required later when the production company applies for the tax credit. It is essential to maintain accurate receipts, contracts, and payroll records to verify that the expenses were incurred in Ohio.

Step 3: Final Application Submission

After the production is completed, the production company must submit a Final Application to the ODSA. This application includes detailed reports of the actual production expenditures and must demonstrate that the production met the minimum in-state spending requirements.

The final application will be reviewed by the ODSA, which will verify that all qualifying expenditures were properly incurred and that the production adhered to the guidelines set forth by the state. Upon approval, the production company will be issued a certificate for the tax credit.

Step 4: Claim the Tax Credit

Once the tax credit is approved, the production company can claim the credit on its state tax return or request a cash refund if the credit exceeds the company's Ohio tax liability.

What Types of Expenditures Qualify for the Ohio Film Tax Credit?

To qualify for the Ohio Film Tax Credit, productions must incur eligible production expenditures (EPEs) within the state. These expenditures must be directly related to the production process and must be spent on activities and services within Ohio.

Qualifying Expenses Include:

Wages and Salaries:
- Wages paid to on-screen talent (actors, actresses, etc.).
- Wages paid to crew members (e.g., directors, camera operators, sound technicians, etc.).
- Production assistants, caterers, and any other personnel working directly on the production.
Set Construction:
- Expenses related to building or renting sets and stages for the production.
- Costs of materials, labor, and any infrastructure needed to set up production environments.
Equipment Rentals:
- Camera equipment, lighting gear, sound systems, and any other rental equipment required for the production.
- Rental of vehicles or machinery used for production purposes.
Location Fees:
- Rental costs for shooting at Ohio-based locations, including buildings, properties, and outdoor sites.
- Any location-based expenses, including permits and fees for filming in specific areas.
Post-Production Costs:
- Expenses related to editing, sound mixing, visual effects, and any other post-production work done in Ohio.
Travel and Accommodations:
- Travel expenses for out-of-state cast and crew members coming to Ohio.
- Lodging, meals, and transportation costs for the production team while in Ohio.

Benefits of the Ohio Film Tax Credit

The Ohio Film Tax Credit offers a wide range of benefits for filmmakers. Not only does it provide significant financial relief, but it also opens doors for collaboration with local talent, businesses, and communities. Here are some of the primary advantages:

Reduced Production Costs:
- The 30% refundable tax credit on in-state wages and 25% on other eligible expenses can substantially reduce the overall production costs, making Ohio an attractive destination for filmmakers.
Job Creation:
- The film industry creates jobs in Ohio, benefiting local workers in areas such as construction, catering, camera operation, and post-production.
Local Business Opportunities:
- Local businesses, including hotels, restaurants, transportation providers, and equipment rental companies, benefit from the influx of film productions. This stimulates the economy by providing new revenue streams for these sectors.
Increased Tourism:
- Successful productions often showcase Ohio’s unique landscapes, architecture, and culture, driving tourism and bringing visitors to Ohio to experience the locations featured in films and television.
Long-Term Economic Growth:
- The Ohio Film Tax Credit encourages continued growth in the state’s entertainment sector, making Ohio a long-term hub for film and media productions.

The Ohio Motion Picture Tax Credit is a robust financial incentive that attracts media productions to the state. It offers filmmakers the opportunity to significantly reduce their production costs while contributing to Ohio's economy through job creation and local business stimulation.

By taking advantage of the OMPTC, filmmakers can enjoy a streamlined application process, a range of qualifying expenses, and an efficient mechanism for claiming the credit, making Ohio a competitive location for future film, television, and digital media projects.

If you're planning a project in Ohio, whether it’s a feature film, a television show, or a digital media production, it’s crucial to understand the ins and outs of the Ohio Film Tax Credit. By leveraging this program, you can maximize your budget and ensure a successful, cost-effective production.

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